Argentina’s Poverty Rate Spikes In First Six Months Of Milei’s Shock Therapy

Argentina’s poverty rate surged from nearly 42% to 53% during the first six months of President Javier Milei’s term, reflecting the harsh impact of the country’s most intense austerity program in recent history, Almudena Calatrava reported for the Associated Press (AP).

Argentina continues to suffer from one of the world’s highest annual inflation rates, surpassing 230%.

The statistics agency's report revealed that Argentina's mid-year poverty rate in 2024 had reached its highest level since 2003, when the country was grappling with the fallout from a major foreign debt default and currency devaluation.

The rise in poverty poses a challenge to Milei, a far-right economist, whose fiscal shock therapy has been welcomed by foreign investors and the International Monetary Fund (IMF), to which Argentina owes $43 billion.

His program has succeeded in reducing monthly inflation from 25.5% last December to 4.2% in recent months.

Despite the improvements in inflation, Argentina continues to suffer from one of the world’s highest annual inflation rates, surpassing 230%. In response to the poverty rate spike, Milei's spokesperson, Manuel Adorni, shifted blame to past administrations during a press conference.

"The government inherited a disastrous situation," Adorni said, criticizing the years of excessive spending under the Peronists that fueled chronic inflation.

Milei has eliminated price controls, slashed subsidies on energy and transport, and devalued the peso by 54% in December, leading to a sharp contraction in consumer spending and a deepening recession.