Javier Milei, president-elect of BUENOS AIRES, announced his plans to reform the economy on Monday, saying that it might take 18 to 24 months to control Argentina’s escalating inflation.
With a promise to stop decades of unchecked state spending and “end the decline of Argentina,” Milei defeated Economy Minister Sergio Massa by 12 points in Sunday’s presidential election.
The 53-year-old outsider vowed to “very quickly put public accounts in order” after drawing comparisons to Brazil’s Jair Bolsonaro and former US president Donald Trump for their abrasive demeanor and contentious remarks.
He stated in a number of morning radio interviews that he had” clear plans” to combat the 40 percent poverty rate and annual inflation that had reached 140 percent.
Milei vowed to replace the depreciating peso with the US dollar during the campaign, accusing the central bank of inciting inflation by printing money to cover government overspending.
According to the empirical evidence in the Argentine case, “destroying ( inflation ) would take between 18 and 24 months if monetary emission were to be stopped today.
Milei opposes abortion, calls for a referendum to end access to the procedure, and denies that people are to blame for global warming.
However, he has toned down his contentious rhetoric and concentrated on his state reform initiatives.
According to Milei,” the private sector will control everything that can be in its hands,” including the state media and the YPF oil company.
Analysts claim that the official peso-to-dollar rate is an expensive fiction, but he promised to push for the elimination of stringent currency exchange controls.
Milei, however, declared that he would first try to pay off the central bank’s debt.
He forewarned that “hyperinflation will always follow us if the central bank problem is not solved.”
ARGENTINES ARE ABLE TO SELECTCURRENCY
When asked about his dollarization strategy, Milei responded that closing the central bank would give Argentines the freedom to choose their own currency.
On December 10, Milei will take office, inheriting a nation with$ 44 billion in debt and the International Monetary Fund looming over his new administration.
Kristalina Georgieva, managing director of the IMF, congratulated Milei and expressed her desire to collaborate with him” to create and carry out a strong plan to safeguard macroeconomic stability and strengthen inclusive growth for all Argentinians.”
The effect of Milei’s victory on the erratic peso has been postponed because Monday is a public holiday.
Argentina has had strict control over the peso’s exchange rate and currency access in recent years, creating a thriving black market for dollars.
Analysts warn that the peso is poised for a sharp devaluation because the value of these so-called “blue dollar” exchanges is almost three times higher than the official rate.
Milei responded,” It is not an option to maintain the trap that hinders the economy,” when asked if he would remove restrictions on the purchase of foreign currency that have been in place since 2019.
Brazil and China, with whom he had previously vowed to cut ties and stated that” we do n’t make deals with communists,” sent their congratulations to the new leader of Latin America’s third-largest economy.
After gaining the support of the center-right opposition, Milei toned down a lot of his more contentious rhetoric; it is unclear whether his policies will be implemented.
President of Brazil, Luiz Inacio Lula da Silva, wished the new Argentine government” good luck and success” after Milei’s victory.
However, embittered Venezuelan President Nicolas Maduro slammed the newly elected president, saying Milei’s victory was a victory for the “neonazi extreme right” and benefited” US imperialism.”
Maduro, whose 2018 re-election was not recognized by several nations, including the United States, said,” We respect the decision of the Argentine people, and we simply call for reflection on the emerging far-right that seeks to impose a return to the colonization of Latin America.”
China congratulated the newly elected president on his victory and announced on Monday that it would continue working with Argentina.
At a regular briefing, foreign ministry spokeswoman Mao Ning stated that” China has always given great importance to the strategic and long-term development of China-Argentine relations.”