The party of Argentine President Javier Milei on Sunday won more seats than expected in the country’s midterm legislative elections, nearly doubling its representation in Congress. Milei’s La Libertad Avanza (LLA) party won more than 40 percent of the vote, as compared to 31 percent for the opposition Peronists, and will now control enough seats to prevent the overturning of presidential vetoes. To what can the ruling party attribute its victory? How significant were U.S. President Donald Trump’s threats to halt planned aid to Argentina in the event that Milei’s party lost? What do the results mean for Milei’s agenda, and how will he seek to capitalize on the victory? What do the results mean for Argentina’s economy and investment in the country?
Carlos Gervasoni, director and chair of the Department of Political Science and International Studies at the Torcuato Di Tella University: “The key factor for the results has been Milei’s success in bringing down inflation, an illness that has plagued Argentines for decades. A lower poverty rate and more law and order in the streets also helped. U.S. President Donald Trump’s threats to halt planned aid were likely inconsequential. Some voters may have seen the threat a reason to support LLA, while more nationalistic types may have perceived it as ‘foreign intervention’ and reacted by voting for other parties. Milei will now have the chance to push ahead with his existing agenda of fiscal hawkishness and price and exchange rate stabilization, and to launch, with some prospects of success, structural reforms, in particular a rationalization of Argentina’s unwieldy tax system and flexibilization of its rigid labor laws. Critical to his success will be whether he follows his previous instincts to rule alone or instead tries to craft a stable ruling coalition with the center-right PRO and other moderate parties that hold the balance of Congress. If this victory makes Milei over-confident, it may backfire. In the short term, Argentine assets will grow in value, and the stabilization plan will have very good chances of consolidating a path of inflation reduction and exchange rate stability. In the long term, it improves the prospects for investors averse to the political risks of exchange controls, import restrictions and higher taxes. However, even in defeat, Peronism remains as the main alternative to LLA; a centrist coalition of governors did not do well on Sunday.”
Kezia McKeague, managing director at McLarty Associates: “In an election framed as a referendum on Milei’s sweeping pro-market reforms, many voters appear to have been motivated by antipathy toward the alternative—a weakened and fragmented Peronist party scarred by memories of recurring economic crises. The electorate also credited Milei for his early success in curbing inflation, despite widespread discontent with the recessionary impact of austerity measures. Moreover, external backing by the Trump administration helped bolster confidence and avert a financial crisis that would have most likely led to a very different outcome at the polls. With Argentine bonds surging in the election’s aftermath, financial investors are interpreting the resounding victory for the ruling party as a mandate for Milei’s economic program—and will expect the government to seek a return to international capital markets next year. Long-term investors in the real economy are likewise more optimistic about the sustainability of the macroeconomic stabilization effort. Indeed, this election provides Argentina with a historic opportunity to make its economy more competitive via a structural-reform agenda, having already accomplished the important (and politically costly) task of stabilizing public finances. Yet, capitalizing on this opportunity will require Milei to evolve from a disruptor into a dealmaker. Even with stronger representation in Congress, his coalition lacks an outright majority, and many of his most ambitious reforms will demand coalition-building and legislative compromise. The president’s ability to temper confrontation with negotiation—working across party lines and engaging governors, unions, and business leaders—will determine whether Argentina’s fragile stabilization can be transformed into durable, broad-based growth.”
Juan Cruz Díaz, managing director at Cefeidas Group in Buenos Aires: “With nearly 40 percent of the vote, the election results represent the most optimistic scenario for the government. Although part of the support for the ruling La Libertad Avanza party (LLA) can be attributed to anti-Peronist sentiment and the absence of strong leadership within the opposition, the outcome suggests that a significant portion of voters continue to back Milei’s effort to redefine Argentina’s economic course—even if it entails enduring hardship. President Trump’s endorsement helped reinforce confidence in the government’s ability to preserve macroeconomic stability at a moment of market stress, even if it played only a limited role in shaping voter preferences. These results provide Milei with a renewed social mandate and greater political leverage to advance his reform agenda. He is likely to capitalize on the victory and the boost in legitimacy to accelerate structural changes during the remaining two years of his term. While LLA still falls short of an outright majority in Congress, its numerical disadvantage has narrowed considerably. Notably, the president has now secured the one-third threshold in both chambers needed to uphold presidential vetoes against opposition-backed legislation—though he will still need to negotiate with Peronist and non-Peronist governors willing to engage in dialogue. From an economic standpoint, while Economy Minister Luis Caputo reiterated that the government’s program would remain unchanged regardless of the electoral outcome, this decisive victory will likely reassure financial markets and international investors about the sustainability and political backing of the stabilization plan. The government hopes that renewed confidence will help ease financing conditions and encourage capital inflows in the short term.”
Benjamin N. Gedan, inaugural fellow in the Latin America Studies Initiative at the Johns Hopkins School of Advanced International Studies: “Far be it for me to rain on Javier Milei’s parade, but the next two years will still be a hard slog. La Libertad Avanza overperformed on Sunday but fell well short of a congressional majority. Turnout was low. Steep spending cuts are political Kryptonite, but the libertarians were still in the catbird seat, given the collapse of Peronism in the last national election. Today, the party’s president is under house arrest and its top officeholder, the Buenos Aires governor, is a Marxist former finance minister who many blame for the deep hole Milei has been doggedly climbing out of. Yet, mistrust of Peronism has not translated into overwhelming support for Milei; his approval rating is down to 47 percent, and his party took only 41 percent of midterm votes. Moreover, Sunday’s strong showing does not solve the problems that nearly upended Milei’s pro-market project a few days ago: an overvalued peso, low dollar reserves, high dollar debt and lousy economic growth. Ideally, Milei will persuade lawmakers to fix Argentina’s labor, tax and pension policy—to increase competitiveness and reassure investors that pro-market reforms are here to stay. Argentina’s last pro-business president also performed well in the midterms, only to see investors run for the hills at the first signs of trouble, torpedoing his re-election and returning the Peronists to power. But perhaps this time, given robust U.S. support, they will stick with Argentina long enough to get to the other side.”
Mariano Machado, principal analyst for the Americas at Verisk Maplecroft: “Fear of Kirchnerism’s return, not devotion to Milei, powered the electorate’s resolve. After months of volatility and market anxiety, voters decided against another turn, favoring continuity. As a result, the new Congress reflects hardening ideological poles and a thinning out of mediating center-ground forces, favoring provincial micro-parties that will hold disproportionate leverage. For Milei, the midterms marked the passage from outsider movement to governing force. The election was a clear success, with La Libertad Avanza’s surge securing a legislative footing unmatched by any outsider president in decades. But the president still lacks an outright majority, limiting the scope for forcing through legislation. For Peronism, the ballot delivered a sobering—but not lethal—blow. The Kirchnerist faction lost ground, yet the broader movement retained organizational depth and territorial control. If congressional discipline remains intact, attempts at obstructionism could become systematic. Ahead, the key test is whether Milei can remain pragmatic after a win that invites overconfidence. Coalition management and negotiated consensus will shape his agenda in the second half of his term, as domestic allies expect real power-sharing, and global backers will watch for competence rather than slogans. For business, the outcome creates a cautiously constructive environment in which Argentina’s path toward fiscal orthodoxy and deep reform appears more credible, though still fragile. The medium-term outlook depends on Milei’s ability to translate momentum into delivery. Congress now offers space for incremental reform, but Argentina’s institutional memory shows that hubris often outlives coalitions.”
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