He promises, if elected, to exit the Paris Climate Accords, of exit the Brics (which Argentina has just joined), of exit Mercosur and above all to say goodbye to weight, to the Central Bank, todollarize definitively and totally the economy of his country. Based on these promises, the outsider but now favorite Javier Milei it even risks being elected president of Argentina already in the first round, next October 22nd. But is this abrupt recipe for breaking with the past and with the international community (apart from the USA) really what South America's third largest economy needs? And is this really what the business world is asking for? The question was asked by Reuters, which in a survey conducted among 125 large Argentine entrepreneurs, found that in reality the corporate environment is absolutely against this extreme solution: only two leaders of the industrial community supported the totaldollarization desired by the candidate “anarcho-capitalist” Milei.
The peso-dollar exchange rate is out of control
Meanwhile, as one of the most important elections in the history of Latin America approaches, the peso-dollar exchange rate keep beating record upon record: at the beginning of this week a dollar, on the official market, was bought for over 350 pesos, while on the parallel market the so-called "blue dolar" is now worth over 1.000 pesos. A situation increasingly out of control, which however a significant part of entrepreneurs would still like to try to manage: a third of those interviewed by Reuters are in favor of maintaining the peso, despite its steep fall and the now triple-digit inflation in Argentina. The majority, around two thirds, is instead in favor of a more moderate formula, i.e. a bi-monetary system as it already exists more or less now. This is the solution proposed by Patricia Bullrich, the candidate of former president Mauricio Macri's party, which represents the liberal center-right. However, Bullrich is far behind in the polls: she is given third place, therefore out of the possible run-off (Milei can pass to the first round if she reaches 45% or 40% but trailing the second by at least 10 points), with 23 -25% of preferences.
Electoral challenge between Milei and Massa
La challenge it should be between the sovereignist who remembers Trump and Bolsonaro, given the lead with 35-36% by a recent El Pais poll, and the outgoing Minister of Economy, the Peronist candidate Sergio Massa, which is negotiating tirelessly with the International Monetary Fund to negotiate new aid and keep its country afloat, but which it currently trails with 28-30% of voting intentions. For now the the economic and financial world did not take a clear side: Massa's work in recent months has been very market-friendly, in the name of austerity and the absolute priority given to the payment of the debt with the IMF, but even the hawk Milei doesn't mind and his rise has favored a speculative spiral on the Buenos Aires Stock Exchange, even though only 7% of the market openly supports Milei.
The majority of those interviewed by Reuters are actually "rooting" for Patricia Bullrich and would still like a gradual solution, to "maintain flexibility and competitiveness, and avoid repeating the unhappy experiences of other Latin American countries that have totallydollarized economies, such as Ecuador or El Salvador”, reports the US agency. But how much influence can the opinion of the elite have in a country that has a poverty rate of over 40%?
