Argentina's New President, Javier Milei, Intends for Drastic Changes
Argentina's upcoming president has shared his intentions to significantly alter the country, and it appears that these changes are starting to take shape. One of the initial proposals includes halving the number of ministries to reduce costs. This move is expected to result in a substantial layoff wave within the public sector.
New President's Agenda
As promised during his election campaign, the ultra-liberal President Milei, who assumed office on Sunday, has embarked upon a radical austerity plan. Government spokesperson Manuel Adorni revealed that all contracts concluded last year are under review.
This plan involves reducing the number of ministries from 18 to 9 and implementing a 34% reduction in staff at various government levels. Adorni emphasized the necessity of shrinking the state, explaining that it is dealing with a bloated state apparatus. He further added that public sector employees' salaries are paid by the 47 million Argentinians.
Economic Struggles
Argentina is currently grappling with a severe economic crisis. The inflation rate exceeds 140%, and approximately 40% of the once-wealthy country's population exists below the poverty line. The nation's second-largest economy is affected by a bloated state structure, minimal industrial productivity, and a large shadow economy that deprives the government of several tax revenues. The national currency, the peso, continues to depreciate against the US dollar, while the nation's debt consistently grows.
Anticipated Changes
In alignment with the president's austerity policies, the US dollar is anticipated to become legal tender in Argentina. This austerity plan might require several ministries, including those subjected to reorganization or eventual closure within the government's ministries folder, to adapt.
References
The information pertaining to the austerity measures in Argentina and their subsequent impact on the public sector and economy can be found below.
- under President Javier Milei's new government:
- The austerity plan involves shrinking the number of ministries and public sector staff.
- Thousands of public servant jobs have been cut with uncertain criteria.
- under President Milei:
- Pensions have seen a significant reduction.
- Salaries for remaining public sector jobs have also been reduced.
- This has led to a sharp decline in purchasing power for Argentinians.
- The number of ministries has been reduced from 18 to 9.
- Essential projects will be the sole focus of public works.
- Social impact, including widespread job losses, reduced purchasing power, and increased poverty, has been considerable.
- Protests against government policies have resulted in two general strikes and several demonstrations.
