In a historic move reflecting a radical shift in the economic policy of South America's second-largest economy, the Argentine parliament yesterday (Friday) approved the general budget proposed by liberal President Javier Mille, marking the first time his budget has been successfully passed since he took office two years ago.
The approval came after a decisive vote in the Senate, where 46 senators supported the bill, 25 opposed it, and one abstained. This step complements the earlier approval by the House of Representatives (the lower chamber), giving the green light for the implementation of the new fiscal policies.
A political victory and a boost to legislative influence
This recognition is a major political victory for the ruling Milli party, which has strengthened its position in the Argentine political landscape. The party's gains in the legislative elections last October shifted the balance of power in both houses of parliament, paving the way for the implementation of a series of key structural reforms in the second half of the presidential term, thus overcoming the obstacles that faced his administration in its early stages.
The “zero deficit” strategy and ending the era of spending
After two years of running the country on the outdated 2023 budget, the new spending bill aims primarily to achieve the ambitious goal of reaching a "zero deficit" level. This strategy relies mainly on reducing public spending and downsizing the size of the government, a policy that differs radically from the expansionary policies pursued by previous governments, which historically led to high inflation and mounting debt.
In this context, Senator Ezekiel Atauch, a member of the ruling party, emphasized the government's commitment to this strict approach, stating, "We will not spend more than we earn, and we will work to balance our accounts." This statement reflects the government's desire to restore the confidence of international markets and lending financial institutions through rigorous fiscal discipline.
Social challenges and postponed reforms
Despite successfully passing the budget, the Milli government still faces significant social challenges. Last week, thousands took to the streets of Buenos Aires to protest another proposed labor reform. Opponents argue that these reforms would erode workers' hard-won rights, and this public pressure has led to a postponement of the controversial proposal until February, indicating that the path to comprehensive economic reform remains fraught with political and social tensions.
