Argentina votes Sunday in a midterm election that will serve as a crucial referendum on President Javier Milei’s ambitious austerity policies and, potentially a $40 billion rescue package from the Trump administration.
Polling stations close at 6:00 p.m. local time (4:00 p.m. local time) and results are expected on Sunday night. Argentines elect representatives for half of the seats (127) in the Chamber of Deputies, along with 24 of the country’s 72 senators. Official results will be published province by province, rather than a single national figure.
Two years after his presidential victory, Milei and his party suddenly find themselves on the ropes. The libertarian leader has managed to reduce inflation and poverty. But its economic recovery is stalling, wages have failed to keep pace with the rising cost of living and the unemployment rate is higher than when Milei took office.
Meanwhile, three corruption scandals have damaged his image as a champion of fighting corruption from outside the establishment he promised to eradicate. Milei’s disapproval rating is now at the highest level of his presidency.
The crushing defeat of Milei’s La Libertad Avanza party, LLA, in September’s local elections has raised the stakes. The defeats in the province of Buenos Aires, where more than a third of Argentines live, generated fears among investors about Milei’s position in the face of the midterm elections, which caused a depreciation of the currency and the liquidation of sovereign bonds.
Two weeks later, US Treasury Secretary Scott Bessent intervened to prop up the peso, but the currency has continued to weaken. Bessent declared Sunday morning that the US will not lose taxpayer money in Argentina.
“We support a US ally. There will be no loss for taxpayers“Bessent stated on NBC’s Meet the Press. “This is a swap line of credit. “It is not a financial rescue.”
Investors are now waiting to see if Milei, who currently holds about 15% of the seats in Congress, can secure at least a third of the seats needed to secure his veto power. In recent months, opposition politicians have overturned several of his vetoes, measures that government officials have denounced as “attacks” on signature fiscal policies that have generated a budget surplus.
“We need a third in a chamber to be able to block these attacks; that is something we are going to achieve, whether we win by five points or lose by seven,” Economy Minister Luis Caputo declared at an Atlantic Council event in Washington earlier this month. “We need a simple majority in both chambers to approve all the reforms that we want to promote, and we are not going to get it even if we win the midterm elections by 15 points”.
