It has been two two years since the free-market reformer Javier Milei took office as president of Argentina. Since December 10, 2023, he has been freeing Argentina’s economy from the shackles imposed by generations of leftist rule by the Peronists.
As the Cato Institute notes,
Milei’s policies have started to reverse the country’s long-standing decline.
As of September, the economy is growing at 5 percent on a yearly basis. Poverty, which exceeded 40 percent before Milei took office and peaked at 52.9 percent in the first half of 2024, is now down to 31.6 percent. Monthly inflation, which often surpassed 10 percent in the pre-Milei era and reached 25 percent in December 2023, now hovers around 2 percent. Both exports and imports are rising rapidly.
But how did these results come about? One of the first measures he took was to balance the budget immediately upon taking office. Since the deficit stood at 4.6 percent of the GDP in 2023, this policy was considered so radical that his opponents said it was impossible to carry out. Yet Argentina posted an impressive 0.3 percent surplus in 2024 and has maintained a balanced budget since then. This fiscal “anchor,” brought about by an astounding 30 percent in real spending cuts, has played the key role in ensuring that inflation comes down. However, fiscal consolidation has also left room for some tax cuts, the latest being a reduction in export taxes, which was announced yesterday.
Argentina has also embarked on a deregulation push, which is yielding impressive results, despite fierce opposition from Congress and special interests…. the rental housing supply in the city of Buenos Aires surged by 212 percent and real prices fell by 27 percent barely seven months after Milei repealed rent control…Daily life has also improved in many other respects as a result of various deregulatory policies, which range from opening up the satellite internet market—and thus providing Argentina’s countryside with much-needed internet access—to eliminating various restrictions and controls on imports, resulting in increased options for consumers.
Exports have also increased.
Before Milei was elected, Argentina experienced decades of decline. Argentina had once been one of the richest nations on earth, richer than Canada, Australia, and all but a handful of countries. But by the time Milei was elected, Argentina had fallen behind around 70 countries, including countries that were once much poorer than it, such as Turkey, South Korea, and Panama. Arbitrary regulations and red tape did much to cause its economic decline.
But after being elected, Milei repealed many of his country’s regulations. Argentina had one of the biggest red-tape burdens on earth, although Brazil has a more complicated tax code, and France has a higher tax burden. At the time Milei was elected, Argentina ranked 23rd worst out of 165 countries in terms of its regulatory burden, imposing more red tape than many European countries with much better health, safety, and labor conditions.
In December 2023, Milei issued a decree that repeals or reforms 300 laws to begin reversing “decades of failure, impoverishment, decadence, and anomie.” Milei had his work cut out for him — Argentina ranked very low in economic freedom in 2023 — 158th out of 165 countries ranked — and ranked a pitiful 163rd in trade freedom.
In 2025, the Heritage Foundation ranked Argentina 124th in economic freedom, which is a huge improvement. “Recording one of the largest score improvements, Argentina’s economy has moved out of the bottom tier of economic freedom in the 2025 Index,” notes the Heritage Foundation. But despite improvement, Argentina still has less economic freedom than neighboring countries like Chile, Paraguay, and Uruguay. There is only so much that Milei can achieve without legislative authorization, and the Argentine Congress is opposed to many potential reforms and includes many left-leaning Peronists.
