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Milei's Reforms: Argentina Reassesses Economic Realism
3 Jan
Summary
- Argentina's Treasury sold dollars to stabilize the peso.
- Salmon farming ban overturned in Tierra del Fuego province.
- Economic reforms under President Milei aim for fiscal balance.
Argentina's Treasury intervened by selling dollars to stabilize the peso on the first day new, more flexible foreign exchange trading rules took effect. The peso weakened slightly, but the intervention aimed to mitigate larger swings. This move occurs as the nation approaches a significant Jan. 9 payment on its dollar bonds, with investors confident in its ability to meet obligations.
A notable policy U-turn has occurred in Tierra del Fuego, where a 2021 ban on salmon farming was overturned. This decision reflects the influence of President Javier Milei's pro-business, deregulation-first agenda, pushing previously stalled projects forward. Similarly, a copper project in Mendoza, previously rejected on environmental grounds, is regaining momentum, highlighting Argentina's focus on its vast untapped mineral reserves.
These shifts underscore a national reassessment of economic priorities, moving towards pragmatism after years of stagnant growth and high inflation. President Milei's insistence on eliminating the fiscal deficit is reshaping the political landscape, with even parts of the opposition adapting to the new economic realism. While historical policy zigzags are a concern, 2026 offers potential for sustained growth and reduced inflation, cementing these reforms.
