The current state of Argentina’s economy is a far cry from what “experts” predicted when they warned that President Javier Milei’s pro-free market leadership would devastate the country.
The chainsaw-wielding libertarian rose to power on promises to slash government spending, implement free-market policies and lift strict currency controls to rescue a nation crippled by inflation, debt and entrenched poverty. Though the pundit class warned that Milei’s policies would spark an economic collapse, the results so far have been a rebuke to those warnings.
Just days before the November 2023 presidential election, 108 economists from around the world signed an open letter claiming that Milei’s “simple solutions” were “likely to cause more devastation in the real world in the short run, while severely reducing policy space in the long run.”
“His policies are poorly thought through. Far from building a consensus, he would struggle to govern,” The Economist’s editorial board wrote in a September 2023 piece describing “Javier Milei’s dangerous allure.”
Well over a year into Milei’s presidency, Argentina is showing its strongest economic performance in years. The country’s gross domestic product (GDP) jumped 7.7% in April compared to the same month in 2024, far exceeding expectations.
The GDP is expected to rise by 5.2% in 2025, compared to declines of 1.3% in 2024 and 1.9% in 2023, according to the Organization for Economic Cooperation and Development (OECD).
Inflation, a long-standing hallmark of Argentina’s economic dysfunction, dropped to 1.5% between April and May, reaching a five-year low. Annual inflation has plunged from 160.9% in November 2023 — just before Milei took office — to 43.5% in May.
Meanwhile, poverty rates have also declined sharply, falling from 52.9% in the first half of 2024 to 38.1% in the second half of the year.
Argentina’s rental housing supply also increased by 212% between December 2023 and June 2024, after Milei repealed the country’s rent control laws, according to the Cato Institute.
“Against the background of a difficult legacy of macroeconomic imbalances, Argentina has embarked on an ambitious reform process, starting with an unprecedented upfront fiscal adjustment. Reforms have started to pay off. Inflation has receded and the economy is set for a strong recovery,” the OECD noted in its new analysis of the Argentinian economy. “Maintaining the reform momentum will be key to restore confidence, boost investment and productivity growth.”
Milei — a self-described anarcho-capitalist — has been an ardent supporter of President Donald Trump’s efforts to downsize the U.S. government, including the Department of Government Efficiency’s (DOGE) push to cut spending.
“I come from a country that bought all of those stupid ideas that went from being one of the most affluent countries in the world to one to one of the [poorest],” Milei said in a speech at the Conservative Political Action Conference in 2024. “If you don’t fight for your freedom, they will drag you into misery … Don’t surrender.”
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