The Senate recently approved a pension increase in Argentina, defying President Javier Milei’s tough austerity program. The move, aimed at matching the country’s triple-digit inflation rate, was passed by a large majority in the Senate, with only Milei’s party members voting against it.
President Milei is expected to veto the pension reform, which he believes would threaten his promise to maintain a fiscal surplus at all costs. Despite his party’s limited representation in Congress, Milei has relied on executive decrees to implement his economic policies, which have led to a fiscal surplus in the first six months of his term.
The recent Senate decision marks a setback for Milei, highlighting his weakness in Congress where leftist and centrist lawmakers hold sway. The president’s strict austerity measures have been met with criticism and protests, with concerns raised about the impact on the country’s economy and social welfare.
Investors are closely watching how Milei handles the pension law, as it could affect the stability of his fiscal program. The president’s confrontational approach and reliance on executive decrees have raised concerns about the country’s economic prospects, with rising poverty levels and soaring inflation rates.
The ongoing tension between President Milei and Congress underscores the challenges he faces in implementing his radical economic agenda. The outcome of the pension reform debate will be closely watched by stakeholders as it could have significant implications for Argentina’s economic future.
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