Argentina’s Economic Revival: Milei’s Reforms Show Progress Amid Social Challenges

A Nation’s Economic Transformation

Argentina’s economy has achieved its strongest growth in nearly two decades, posting a 7.6 percent year-over-year growth rate in the second quarter of 2025. This remarkable turnaround comes after the country seemed destined for economic collapse, plagued by soaring poverty and runaway inflation.

Reform and Recovery

Since taking office in December 2023, President Javier Milei has implemented dramatic reforms, including slashing government expenditures, securing a $20 billion deal with the International Monetary Fund, devaluing the peso by 50%, cutting fuel subsidies, and halving the number of government ministries.

The results have been significant: annual inflation has dropped from 211.4 percent in 2023 to 43.5 percent by mid-2025, with wholesale prices even falling by 0.3 percent in May—the best figure in 17 years.

Social Impact and Challenges

However, the government’s fiscal overhaul and monetary tightening have come at a considerable social cost. While poverty has decreased from its December peak of 53 percent to 38 percent of Argentina’s population, social tensions remain high. In April, a general strike paralyzed Buenos Aires as unions protested budget cuts and reduced government transfers.

Future Outlook

Beyond 2025, Argentina’s economic expansion is expected to continue above the regional average. The country possesses significant economic potential, with some of the world’s largest lithium and gas reserves, along with substantial renewable energy capacity. If Argentina maintains its current path of fiscal discipline and economic liberalization, living standards could see substantial improvement.

However, challenges remain, including the risk of currency instability and potential opposition from political and social groups, particularly if economic improvements don’t reach all sectors of society.