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Milei is sworn in as Argentina braces for his shock therapy

Patrick Gillespie and Manuela Tobias, Bloomberg News on

Published in News & Features

Javier Milei took office as Argentina’s president Sunday, promising to eradicate inflation and rescue the nation’s troubled economy with a shock-therapy program based on drastic cuts to public spending.

The libertarian leader, who beat out Argentina’s traditional political coalitions to win an election run-off last month, took the oath of office in a ceremony in Congress, where he received the presidential sash from his predecessor to the chant of “freedom, freedom.”

He then delivered a somber message to the nation, warning that Argentines will have to endure additional pain while he works to pull the country from the economic crisis inherited from his predecessor. The outgoing administration of Alberto Fernandez has planted inflation that could reach 15,000% if the government doesn’t change course, he said.

“They’ve ruined our lives,” Milei told a large public waiting for him outside Congress. “There’s no money.”

He reiterated his pledge to cut spending rapidly, saying “there’s no alternative, nor much time.” The economy will worsen in the short term before turning around, he added.

Attending the ceremony were the Latin American presidents of Uruguay, Paraguay and Chile, alongside European leaders including Hungary’s Viktor Orban and Ukraine’s Volodymyr Zelenskyy. Brazil’s Luiz Inacio Lula da Silva didn’t attend his inauguration, being represented by his foreign minister.

 

During the campaign, Milei’s radical proposals to rein in inflation — such as introducing the dollar as an alternative to the peso and shutting down the central bank — resonated with Argentines outraged with consumer prices soaring more 140% a year. But in an unexpected turn to pragmatism, he seemed to put such difficult-to-implement plans on the back burner, prioritizing a classic program of fiscal adjustment instead.

His first measures will be announced at a news conference Monday morning, according to his spokesman.

Signs of Milei’s pragmatism became apparent with his first cabinet choices, which pleased investors and triggered a rally in the nation’s dollar bonds and stocks.

He appointed Patricia Bullrich, a former adversary who joined forces with him after being defeated in the first round of the presidential election, to be his security minister. And he handed the crucial economy ministry job to Luis Caputo, a former finance chief and central bank president who also negotiated with holdout debt investors and the International Monetary Fund during the administration of Mauricio Macri.

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