Argentina goes to polls amid economic crisis and Trump ‘interference’

Facundo Iglesia in Buenos Aires and Tom Phillips in Rio de Janeiro

Argentina’s radical libertarian leader, Javier Milei, is facing a pivotal moment in his presidency with voters set to deliver their verdict on his two-year-old administration on Sunday against a backdrop of political and economic crisis and accusations that his ally Donald Trump is meddling in the country’s affairs.

A poor showing in Sunday’s midterm election would be a hammer blow to Milei, who took power in December 2023 pledging to kickstart “a new era of peace and prosperity” by slashing spending and inflation.

Milei has had some success in taming triple-digit inflation, but in recent months the 55-year-old former TV celebrity has been buffeted by a succession of crises, including corruption scandals involving his sister, and chief-of-staff, Karina Milei, and another close ally who was linked to an alleged drug trafficker, and a sell-off of Argentina’s currency, the peso.

In August, Milei was pelted with stones by angry voters and the following month his party, La Libertad Avanza, suffered a stinging defeat in the provincial election in Buenos Aires, where 40% of Argentina’s 45 million citizens live.

The US president, who is Milei’s most powerful foreign friend, has thrown him a lifeline in the form of a bailout that could total US$40bn (£30bn). But even Trump painted a dire picture of the South American country’s stagnating economy last week, telling reporters: “Argentina is fighting for its life … They are dying.”

Trump has warned he could axe the aid package if Milei fares poorly in Sunday’s vote, when half of the seats in the 257-member lower house are up for grabs as well as 24 seats in the 72-member senate. “If he doesn’t win, we’re gone,” Trump said last week while hosting Milei at the White House.

Trump’s apparent attempt to influence Argentine voters is not his first intervention in South American politics this year. Starting in July, the US president set about trying to derail the trial of his far-right ally, the former Brazilian president Jair Bolsonaro, with a campaign of tariffs and sanctions against Brazil and its officials. But that campaign failed, boosting the political fortunes of Brazil’s leftwing president, Luiz Inácio Lula da Silva, while also failing to save Bolsonaro from a 27-year sentence for plotting a coup.

In Argentina, Milei’s political opponents also predict Trump’s manoeuvres will backfire.

Itai Hagman, an economist and Peronist seeking re-election to the lower house in Buenos Aires on Sunday, accused Trump of trying to “extort” Argentine voters with his threat to withdraw his rescue package.

“It is a clear interference in the internal affairs of another country,” said Hagman. “The Argentine people [will] … defend their sovereignty and their democracy. They will not vote based on what the president of another country tells them, but on their own interests and will.”

Hagman called Sunday’s elections a referendum on “a libertarian anarcho-capitalist experiment” that was “causing brutal economic and social suffering” with its severe austerity measures and had “decided to delegate economic management to officials from another country”.

Milei allies are asking voters to be patient. “We cannot solve all the problems that the country has had for 100 years in two years,” said Gonzalo Roca, Freedom Advance’s main congressional candidate in Córdoba. He insisted the country was “on the right path”, but admitted Milei’s blueprint required “effort and sacrifice”.

Gustavo Córdoba, a political analyst and the co-director of the consultancy Zuban Córdoba, predicted voters would “punish Milei for their economic hardship” with his polling showing that 60% of Argentinians could not make ends meet.

Benjamin Gedan, the director of the Latin America programme at the Stimson Centre in Washington, said public dissatisfaction had been building since earlier this year among voters who had been promised “a period of shared prosperity” if they endured Milei’s structural adjustment.

“That really hasn’t materialised,” Gedan added, pointing to a growing sense among Argentininians “that prosperity is around the corner – and always will be”.

Gedan believed Milei faced a crunch moment this weekend. He said: “If he does very badly you could have a real economic and financial crisis and another run on the peso.”

Gedan said a “muddled” result was more likely, which would allow Milei to claim some success in increasing his party’s representation in congress and enable him to see out the remaining half of his four-year term but make it “really difficult for him to continue transforming Argentina in any sustainable way”.

Argentina’s president, according to Gedan, had enjoyed a long honeymoon despite his politically damaging budget cuts.

“There weren’t tremendous public protests. He wasn’t beset by national strikes at union activism … But inevitably his political honeymoon would end: his was longer than that of many of his peers’ – especially given the shock therapy he was imposing. But it couldn’t last for ever.”