Argentina’s Poverty Reaches New High

President Javier Milei is enacting radical economic reforms, sparking protests, and causing international concern over Argentina's stability (WikiCommons)

Data released by Argentina’s statistics agency on September 26 documented that Argentina’s poverty rate surged past 50 percent, a record high that underscores the nation’s deepening economic crisis. The rise in poverty reflects multiple factors, including political instability, long-term economic mismanagement, and the controversial policies of President Javier Milei. 

Argentina is no stranger to economic crises. According to BBC, decades of inflation and periodic economic slumps have nurtured a recurring poverty crisis. Most notably, the country experienced an economic collapse in 2001 in which Argentina defaulted on its debt, creating instability, as stated by the Associated Press. Up until 2024, populist left-wing governments have tried to improve the economy through welfare policies and reforms, claimed CNN. However, The Guardian reported that those attempts were usually unsuccessful, with inflation still rising. BBC noted that over the last few years, inflation has consistently been above 100 percent further depreciating the Argentine peso and decreasing the purchasing power of Argentinians.

In the first half of 2024, Argentina's poverty rate reached 52.7 percent, the highest in decades as reported by the National Institute of Statistics and Census of Argentina on September 26. France24 documented that the high poverty rates disproportionately impacted children and marginalized communities, many of whom are experiencing food insecurity. The government's inability to stabilize the Argentine peso has worsened these conditions according to CNN.

Milei built his name on challenging a powerful political establishment in Argentina, according to The Associated Press. Express News detailed that Milei has been both praised for his willingness to shake up the system and criticized for his radical economic policies.

Milei’s reforms focus on reducing government intervention, eliminating central bank control, and promoting dollarization of the economy, France24 reported. Reuters documented that international financial organizations and foreign investors have expressed concern over Milei’s policies, with many questioning whether his reforms will stabilize or further destabilize Argentina’s fragile economy. 

The Associated Press noted that many Argentinians have been affected by food shortages and high prices, correlating with increasing homelessness, unemployment, and crime rates. In response, protests have erupted across the country, with calls for Milei to either change his policy direction or resign, as reported by The Guardian. Express News stated that labor strikes have further disrupted daily life as workers demand higher wages and better protections against economic turmoil.

Both the International Monetary Fund (IMF) and the World Bank have received Milei’s leadership with caution, writes the Financial Times. The Guardian reports strained relations between the country and these institutions, as well as continued uncertainty about whether the IMF bailout program will continue. Reuters claims that investors are skeptical of Argentinian markets due to fear of further instability. According to the Financial Times, economists have a gloomy outlook of Argentina’s global economy, warning that the country may fail to recover from the current economic slump, if there are no immediate and radical reforms.