Argentine President Reiterates Economic Success and Delineates Monetary Goals
Argentine President Javier Milei, renowned for his aggressive economic plan in 2024, has outlined his next objectives in monetary matters. He intends to solidify the type of change and stabilize the dollar’s value, as well as reconfigure debt maturities.
In a recent statement, Milei declared, "We’ve recovered points of GDP that the state used to rob through monetary emission to finance the government." He emphasized that his administration has "made artful use of the right to defend property and improve pensions." Regarding inflation, if it remains around 2.5% in December, he aims to decrease the crawling peg from 2% to 1% per month, and if it hovers around 1.5% over three months, he will remove the crawling peg altogether. However, Milei maintains that the dollar is not yet behind.
The President also asserted that Argentina will not take on new debt, only refinancing old debt. He elaborated, "We’re taking funds to pay down debt owed to the Central Bank, so the variation in net debt is zero. The Treasury will still owe the same amount, but to a creditor, not the Central Bank."
Milei’s proposal for dollarization involves channeling dollars into the Central Bank to enhance its balance sheet, potentially enabling full dollarization in the future. He admitted that this process could take another two years and that closing the Central Bank would be the subsequent step.
On the topic of taxation, the President did not provide new announcements but underscored the official stance by citing the recent firing of Florencia Misrahi, the former head of ARCA, who attempted to impose taxes on new categories of digital workers.
Looking ahead to the 2025 elections, Milei underscored the government’s progress in reducing poverty by 21%, lifting nearly 9 million Argentines out of poverty. He entreated supposed non-Kirchnerist allies to reflect on their positions and support freedom of ideas.
Regarding a potential alliance with Mauricio Macri’s PRO party, Milei expressed affection and admiration for Macri and left the door open to absorbing the PRO into his libertarian party. He also discussed the possible presidential candidacy of his sister, Karina Milei, stating that the decision is hers to make but that her political muscle is growing.
Meanwhile, Milei criticized Vice President Victoria Villarruel for being "disconnected from reality" after she complained about her salary, which is reportedly lower than various other public officials’. Milei pointed out that the vast majority of Argentines earn far less than Villarruel, emphasizing the disconnect between the political elite and the general public. He noted that the salaries of senators are around 10 million pesos, much higher than average, and expressed regret that Villarruel would make such a comment. When asked about the internal struggle between them, Milei stated that Villarruel had distanced herself from his administration’s policies and preferred to align herself with trends favored by Argentina’s elite.
