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Don't cry for Milei, Argentina: Peso plunges after populist tops primary polls

Javier Milei, presidential candidate of the Liberty Advances coalition, after polling stations closed during primary elections in Buenos Aires, Argentina, Sunday, Aug. 13, 2
Javier Milei, presidential candidate of the Liberty Advances coalition, after polling stations closed during primary elections in Buenos Aires, Argentina, Sunday, Aug. 13, 2 Copyright Natacha Pisarenko/Copyright 2023 The AP. All rights reserved
Copyright Natacha Pisarenko/Copyright 2023 The AP. All rights reserved
By Euronews with AP
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Populist Javier Milei won the Presidential primary poll in Argentina, triggering turmoil in financial markets.

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The Argentine peso plunged this week after an anti-establishment candidate who admires former President Donald Trump came first in primary elections that will help determine the country's next president.

Javier Milei rocked Argentina's political establishment by receiving the biggest share of primary votes for presidential candidates in the October general election to decide who leads a nation battered by economic woes.

Milei, 52, wants to replace the peso with the dollar and says that Argentina's Central Bank should be abolished. He has said that climate change is a lie and has characterised sex education as a ploy to destroy the family. He has also said that the sale of human organs should be legal.

Gun ownership is severely restricted in Argentina. Milei proposes the "deregulation of the legal market" for weapons and "the protection of its legitimate and responsible use by the citizens," according to his party's electoral platform.

Argentina's government decided to devalue the local currency by 20% early Monday morning after the surprising Sunday showing. Two mainstream political coalitions have traded power for a decade in Argentina. The country is now the latest where voters have picked an outsider candidate to express anger against the status quo.

Christopher Sabatini, a Senior Research Fellow at Chatham House in London told Euronews that Javier Milei’s popularity is symptomatic of a sense of political malaise among voters in many countries.

He said: "There is a sense that there's been no political renovation, that politicians are unaccountable. But also the sense of profound economic insecurity that's driving this. When people don't trust their politicians, when they don't trust their institutions, they look for extreme answers outside the system".

Operators were watching nervously Monday as the value of the peso also decreased in the parallel, or blue, market, dropping 12% by early afternoon.

Milei said the government was trying to blame his victory for the depreciation of the currency.

"One of the things the government is trying to convey is that devaluation and all these things are our fault," Milei said in an interview Monday with cable news channel LN+.

The drop in the value of the peso means that already-high inflation will accelerate, making getting to the end of the month even harder for ordinary people.

"The more the dollar rises, the more expensive things become," Marta Gisela Barrera, a 29-year-old urban recycler who has trouble buying enough food for her four children, said on Monday morning. "I don't know what's going to happen anymore."

Argentina requires that citizens vote, with a symbolic financial penalty for not voting, and 69% of the country's 35 million voters went to the polls, each choosing candidates for positions ranging from local councilman to president. It marked the lowest participation for presidential primaries since the current system was set up in 2009.

The major parties had contested races to be its presidential candidate. Milei was uncontested and got a few points more than the candidates of parties that have dominated Argentine politics.

After doing much better than expected, the upstart candidate with long sideburns and shaggy hair who gained notoriety and a rockstar-like following by angrily ranting against the "political caste" is now a real contender for the presidency.

"We've had 40 years of failures, don't tell me this time will be different. The central problem is that the solution to the problem is in the hands of the same problem, which is the politicians," Milei said in the LN+ interview.

In Brazil, Jair Bolsonaro was president from 2019 to 2022 and had a similar anti-left and anti-social justice orientation. Right-wing populists are also making inroads with a tough-on-crime message, most notably in El Salvador, where the popularity of President Nayib Bukele has soared amid a crackdown on gangs that has led to human rights abuses.

If he were to win "my allies would be the United States and Israel," Millei said, adding he would move Argentina's embassy in Israel from Tel Aviv to Jerusalem, following in Trump's footsteps.

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With around 97% of polling locations reporting, Milei had around 30% of the total vote, according to official results. The candidates in the main opposition coalition, United for Change, were at 28% and the governing Union for the Homeland coalition had 27%.

In order to win the vote in two months, Milei would have to increase his share of the nation's votes by 15%, a high hurdle even in a nation where voters tend to favour candidates they see as winners.

If one candidate doesn't receive 45% of the vote, they would need 40% and a 10-point lead over the second-place candidate. Otherwise, the race would go to a November runoff between the top two.

Celebrating in his election headquarters, Milei vowed to bring "an end to the parasitic, corrupt and useless political caste that exists in this country."

"Today we took the first step toward the reconstruction of Argentina," he said. "A different Argentina is impossible with the same people as always."

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In Buenos Aires on Monday, Milei's supporters seemed most excited about someone new coming into the scene.

"We always end up going back to the other party, then the other comes back, and it's a cycle that keeps us in the same situation," Clara Costa, a 54-year-old administrative assistant, said.

Milei has been a lawmaker in the lower house of Argentina's Congress since 2021.

Argentina is struggling with annual inflation of over 100%, rising poverty and a rapidly depreciating currency, and Milei first attracted wider support by calling for the country to replace the peso with the U.S. dollar.

Milei would need Congress to support that and that would be highly unlikely. As a result, he has said he would push for a referendum or a non-binding popular vote on the issue, although it's also unclear if he would be able to push that through without the support of lawmakers.

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Asked about the vote in Argentina, Mexican President Andrés Manuel López Obrador stated that inflation and economic crises "always benefit the right and conservatism, which is somewhat what's happening in Argentina," and he mentioned the case of Hitler. He immediately made clear he wasn't making a direct comparison between the two but said it was "important to remember" that "inflation actually helped" Hitler rise to power.

Bolsonaro's lawmaker son, Eduardo Bolsonaro, celebrated the results, characterising them on social media as "an excellent start to what could be the real change that Argentina needs." Days before the primaries, former President Bolsonaro published a short video wishing Milei luck in the election.

The main opposition coalition, United for Change, moved more to the right as former Security Minister Patricia Bullrich, who made toughness on crime a centrepiece of her campaign, handily beat a more centrist contender.

In the currently governing coalition, Union for the Homeland, the more business-friendly candidate — Economy Minister Sergio Massa — easily beat a leftist contender but still took an overall beating from voters frustrated over the poor state of the economy, finishing in third place for total votes.

At Milei's electoral headquarters, party leaders were ecstatic while people celebrated outside, expressing optimism that their candidate's support would only grow in the run-up to October.

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