Argentina’s President Javier Milei presented the 2025 budget to Congress, promising to end the country’s persistent budget deficit, according to AP News.
Milei personally presented the budget to Congress in place of his economy minister. He also criticised Argentina’s history of macroeconomic mismanagement, promising to veto anything that would jeopardise his hard work on tough fiscal policy.
The president’s budget proposal followed a week of political infighting in the legislature over spending increases. However, the administration warned that it would undermine the IMF-backed “zero deficit” budget.
The cornerstone of this budget is the first truth of macroeconomics, a truth that for many years has been neglected in Argentina: that of zero deficit. Managing means cleaning up the balance sheet, deactivating the debt bomb that we inherited.
Milei’s supporters interrupted his speech with cheers and shouts of approval. The opposition-dominated Congress, which controls the government’s finances, will have to approve the final budget. However, Milei vowed that nothing would stop him from continuing his austerity policies.
We will only discuss the increase in spending when it comes along with an explanation of what we’ll cut to compensate for it.
The fight over pensions reached its climax last week when Milei and his allies derailed a bill that would have increased social security spending in Argentina. Outraged pensioners, who have lost about half of their purchasing power to inflation, took to the streets of downtown Buenos Aires on Wednesday when the bill’s rejection was announced.
In an optimistic budget statement on Sunday, the finance ministry said it expected Milei’s proposal would lead to annual inflation of just 18 per cent by the end of 2025 and generate an economic growth rate of 5 per cent.
Although Milei has repeatedly compromised to get his bill through Congress, he took a harsh tone in his Sunday speech, calling lawmakers who disagreed with him “miserable rats who bet against the country.”
