How Javier Milei’s Bold Reforms Ended Argentina’s 123-Year Budget Deficit and Tamed Soaring Inflation
Argentina has achieved a historic milestone under President Javier Milei, ending its budget deficit for the first time in 123 years. Marking one year in office, Mr. Milei’s drastic cost-cutting measures and economic reforms have placed the country on a path to stability.
When Mr. Milei assumed office on December 10, 2023, Argentina was battling chronic inflation, with prices in supermarkets fluctuating daily. In response, he implemented what he called a “chain-saw austerity” approach, resulting in a remarkable turnaround.
Inflation, which peaked at over 200% in 2023 — the highest in the world — was brought under control. By October 2024, inflation had fallen to just 2.7%, down from 25% in December 2023.
“Deficit: The Root of All Evils”
Speaking in a national broadcast to commemorate his first year in office, Mr. Milei said,
“The deficit was the root of all our evils—without it, there’s no debt, no emission, no inflation. Today, we have a sustained fiscal surplus, free of default, for the first time in 123 years.”
He credited the achievement to what he described as “the greatest adjustment in history” and eliminating monetary emissions.
“A year ago, a degenerate printed 13% of GDP to win an election, fuelling inflation. Today, monetary emission is a thing of the past,” he added.
Cost-Cutting Moves Save Billions
Mr. Milei wasted no time in implementing his fiscal reforms. Within a week of taking office, he sold two national aircraft and reduced the fleet of official vehicles, saving $3 billion annually.
In April, he demonstrated his commitment to fiscal discipline by firing Labour Minister Omar Yasín, who approved pay raises for senior government officials despite the country’s economic crisis.
Global Praise for Milei’s Achievement
Mr. Milei’s swift and bold actions to end a 123-year deficit have drawn praise from global figures, including billionaire Elon Musk, who congratulated him on X.
This historic turnaround marks a new chapter for Argentina, with Mr. Milei’s presidency becoming synonymous with unprecedented economic recovery and reform.
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