Argentina uploads first budget excess in more than 10 years

(MENAFN) Argentina has posted its first budget surplus in more than ten years, a year after President Javier Milei took office and implemented drastic economic measures aimed at stabilizing the country. The 2024 surplus reached 1.76 trillion pesos (around $4.5 billion), or 0.3% of GDP, marking the first surplus since 2010, according to the Economy Ministry.

This positive outcome contrasts with the fiscal deficits of 2.4% and 2.9% of GDP recorded in 2022 and 2023, respectively, while inflation soared to over 211% in 2023, the highest since the 1990s. Argentina also entered a recession in 2023 and the first half of 2024.

Milei, a libertarian economist, implemented strict austerity measures, including devaluing the national currency by 52%, cutting over 33,000 public sector jobs, and reducing subsidies on essential services like fuel, transport, and energy. Despite the measures, inflation peaked at nearly 300% in April but then fell to 117.8% by December. Argentina emerged from recession in the third quarter of 2024, with GDP growth of 3.9%.

The government's commitment to fiscal discipline was emphasized by Economy Minister Luis Caputo, while IMF Managing Director Kristalina Georgieva praised the country’s "remarkable transformation," highlighting the reduction of the fiscal deficit and improving economic conditions. However, Milei's policies have been contentious, with an additional 5 million people falling into poverty and widespread protests, including violent clashes in June.

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