Peru’s Path Forward: Navigating Political, Economic, and Global Dynamics

LATIN AMERICA ADVISOR

LATIN AMERICA ADVISOR

A daily publication Of the dialogue

January 24, 2025

How Well Are Milei’s Policies Fostering Argentina’s Growth?

Argentina’s rate of inflation at the end of last year fell to an annual level of 118 percent. President Javier Milei launched economic reform policies soon after taking office in December 2023. // File Photo: @JMilei via X.

Q

A

Daiana Fernández Molero, economist and national deputy for the PRO party: “Argentina’s recent decline in inflation reflects a strong commitment to fiscal discipline. President Milei campaigned openly on implementing necessary fiscal adjustments, a rare approach in Argentine politics. Equally significant was the responsible support from segments of the opposition, including the PRO party and former President Mauricio Macri, which endorsed politically difficult measures to achieve fiscal balance. This combination has been instrumental in reducing both inflation and poverty. Nevertheless, significant challenges remain. Removing capital controls, or the cepo, is essential for economic normalization. An agreement with the IMF, expected before April, could facilitate this process. While lifting the cepo may temporarily lead to a spike in inflation due to devaluation, sustained fiscal discipline should…”

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