Rent, privatizations, labor law… Argentinian far-right head of state Javier Milei announced on Wednesday December 20 a massive deregulation of Latin America’s third largest economy and signed a decree intended to modify or repeal more than 300 standards. “The objective is to begin the path towards rebuilding the country, returning freedom and autonomy to individuals and beginning to disarm the enormous amount of regulations that have held back, hindered and prevented economic growth in our country,” Milei said in a speech broadcast on radio and television.
However, the text must still go through Parliament, where his party is in the minority. Among the measures announced is the repeal of the law governing rents “so that the real estate market begins to function smoothly again”, explained the president who took office on December 10. Laws preventing the privatization of public companies such as the airline Aerolineas Argentinas or the oil group YPF must also be repealed. Public companies will all be transformed into public limited companies with a view to their privatization, said Javier Milei.
Tourism, health, Internet, air transport…
The head of state also announced a “modernization of labor law” to create more jobs, the modification of the law on companies so that football clubs can transform into limited companies, and a long series of other deregulation measures in the sectors of tourism, health, Internet, air transport, pharmacy, viticulture and even commerce.
The decree was published at midnight in the Official Journal. It will have to be examined within ten days by a joint commission made up of deputies and senators, but will only be invalidated if it is rejected by both chambers of Parliament, constitutional lawyer Emiliano Vitaliani explained to AFP.
Javier Milei’s far-right party, La Libertad Avanza, has only 40 seats out of 257 in the Lower House and only seven seats in the Senate out of 72. It will therefore have to seek support from the center-right coalition Juntos por el Cambio, partially allied with Milei and which has 81 deputies and 24 senators, and with 26 deputies and eight independent senators. The Peronist opposition has 105 deputies and 33 senators, and the left has five deputies.
Reduce inflation to 160%
“This message is not surprising because there is nothing that Milei did not say he was going to do during the campaign. But it is surprising that the measure was taken in this way, with a decree of emergency,” commented political scientist Lara Goyburu to AFP. Javier Milei announced on December 12 a first series of measures, including a shock devaluation of more than 50% of the peso and the reduction of transport and energy subsidies.
This 53-year-old economist was elected on a program of “cutting” the State, clearing the “political caste” and shock therapy to restore the country where inflation exceeds 160% over one year and which has more than 40% poor people. Milei wants to reduce public spending to 5% of gross domestic product (GDP). Argentina has been involved in “a series of crises over the last hundred years which all have the same origin: the budget deficit”, he justified in his speech.
Protests in response
The presidential address was greeted by a chorus of protests in several neighborhoods of Buenos Aires, and thousands of people spontaneously took to the streets near the Parliament to express their rejection. A few hours before the presidential address, thousands of demonstrators had already marched in the capital at the call of the left-wing organizations Polo Obrero and Movimiento Socialista. It was the first demonstration against Milei since he came to power.
“There is a brutal adjustment, we have to organize and go out to resist,” Ezequiel Pretti, a 34-year-old employee, told AFP, saying he also wanted to “defend democratic freedoms, the freedom to demonstrate.” The scale of the police force, supervised by the president and his Minister of Security Patricia Bullrich from the headquarters of the federal police, was criticized by the organizers. “It reminds me of the dictatorship,” commented Eduardo Belliboni, leader of Polo Obrero.