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Argentina’s Poverty Rate Reaches 57.4%, Setting a New High as President Milei Continues Shock Therapy

Out of the 45 million Argentinians, about 27 million are poor and seven million are living in extreme poverty – meaning they cannot adequately cover their food needs, according to the UCA body.

The increase in poverty levels in January was partly due to the devaluation of the Argentine Peso applied by the Milei government shortly after Milei took office in December 2023. This resulted in an increase in the price of the country’s basic essentials, including food, services and non-food goods.

Milei, an ultra-liberal economist and self-described Anarcho-Capitalist, is implementing a series of shock measures, including a sharp reduction in public spending which has seen Argentina run a surplus of 518.41 billion pesos ($620.85 million U.S. dollars) in their monthly budget for the first time since 2012.

Milei took office promising to “dollarize” the economy, tame an annual inflation rate of more than 200%, and to eliminate the fiscal deficit and end benefits for Argentina’s political dynasties, which Milei calls “the caste.”

Other promised measures included slashing energy and transportation subsidies and rolling out tax hikes aimed at reaching fiscal balance.

Former Vice President Fernández de Kirchner (2019-2023), who was President between 2007 and 2015, attributed the poverty problem largely to the policies of conservative President Mauricio Macri (2015-2019) who succeeded her, and to the adjustments applied by the current administration.

Kirchner said that, starting in 2018, “with a debt in dollars and the return of the IMF (International Monetary Fund)… we went backwards.” The reality presented by the study, Fernández de Kirchner said, shows that “today we are worse off than in 2004.” The government responded to Fernández de Kirchner by asking her to “be silent.”

Milei has forecasted an economic rebound within three months for Argentina.