(Opinion) The unexpected outcome of Argentina’s recent primaries, indicating an unpredictable general election in October, adds fuel to the fire of the nation’s already fragile economic state.
With the direction the economy will take under the next government being anyone’s guess, the primaries revealed a deeply divided electorate.
Libertarian economist Javier Milei led with 30.1% of the votes, disrupting the prior polarization between the center-right opposition, Juntos por el Cambio (28.3%), and the ruling leftwing coalition, Unión por la Patria (27.2%).
This unanticipated result, not foreseen by polls and a shock to the market, underscores a demand from over half of the Argentinians for a significant change in direction.
“Whichever candidate wins in October, there’s massive public support for taking necessary actions to effect that change, which should be promising news for the markets,” notes Aldo Abram, Executive Director at Fundación Libertad y Progreso.
The elections, however, cast shadows of doubt over the October face-off: Can Milei gain more traction with his beyond-neoliberal ideas?
Might there be a transfer of votes between Patricia Bullrich, leader of Juntos por el Cambio, and Milei?
Beyond political uncertainties, the key contenders have starkly contrasting economic visions for a country grappling with fiscal imbalances, soaring inflation, rising poverty, and a staggering debt with the IMF.
Regardless of who assumes the presidency come December 10th, significant concerns loom over the chosen economic path and its pace.
Bullrich argues for immediate, decisive measures, advocating for a dual-currency system and promptly removing restrictions on dollar purchases.
Milei pushes for a radical turnaround, suggesting the shutdown of the Central Bank and a phased dollarization of the economy.
Contrarily, Massa cautions against sudden changes, emphasizing the need for steady trade and currency flows before lifting any restrictions.
As candidates delve deep into debates, Argentina, devoid of monetary reserves, remains caught in the crossfire of a stagnant economy, constant currency turmoil, and segments of society burdened by relentless inflation.