Strict austerity measures

Argentina’s president continues to use the chainsaw

Milei during the presidential election campaign in 2013

(Bild: APA/AFP)

Argentina's President Javier Milei has announced a continuation of his strict austerity measures. He will continue to cut government spending with a "chainsaw" in the coming year, Milei wrote in the online service X on Tuesday. 

The right-wing populist and self-proclaimed "anarcho-capitalist", who often appeared with a chainsaw during the election campaign, announced a "shock therapy" for Argentina when he took office almost a year ago.

His aim was to get the galloping inflation under control and boost the economy. Milei's government cut state spending, scrapped subsidies and cut more than 33,000 jobs in the public sector. At the beginning of 2024, Argentina recorded its first budget surplus since 2008 and was able to significantly curb inflation.

Economy still stuck in recession
However, the economy is stuck in recession and gross domestic product is set to shrink by 3.5 percent by the end of the year, according to the World Bank. According to official figures, over 52 percent of Argentinians were affected by poverty in the first half of the year, which corresponds to an increase of eleven percentage points within six months.

Congress in Buenos Aires is currently negotiating the budget for the coming year. Milei's party does not have its own majority in either chamber of Congress.