Javier Milei's administration announced significant spending cuts, including halting new infrastructure projects, laying off government workers, reducing subsidies, cutting payments to provinces, and halving the number of federal ministries. A sharp devaluation of the Argentine peso was also implemented, setting $1 to 800 pesos.
These measures are intended to address years of government overspending and economic crisis. However, they are expected to worsen the already dire situation, with inflation exceeding 140 percent and the potential for increased poverty and hunger. The currency devaluation will likely further fuel price increases.
Mr. Milei and many economists argue that these severe reforms are necessary for long-term economic stability, despite the immediate pain. Argentina's current situation is described as one of its worst economic crises.