(CNN Spanish) — The conclusion of the 2023 presidential elections in Argentina is approaching, characterized by a series of surprises from the holding of open, simultaneous and mandatory primary elections (PASO), from the first round to coalition results. This Sunday, citizens will use their last chance to decide who will be elected between Sergio Massa and Javier Mille to rule the country for the next four years. But what challenges will the next Argentine president face?
Inflation is the main problem to be solved
Analysts consulted by CNN agree that the central axis of what’s to come, as well as today, is inflation and what it means. The latest official data shows an increase of 120% so far this year and more than 140% year-on-year. This long-standing problem in Argentina, governments with different ideologies have not found a solution to control it, at least in the last decade, including 40% poverty, high levels of labor informality and other negative indicators. exchange rate.
“Argentina faces short-term challenges, which are very urgent, and medium-term challenges, which are urgent,” says Estefania Bozo, a journalist specializing in economics and finance and editor-in-chief of the Buenos Aires Herald. “This is a year of very low agricultural production, very few dollars in the central bank and taking away the government’s muscle to make decisions about economic policy,” he concludes, “in the medium term, is complicated. “Because of this lack of dollars the government had to take responsibility, the exchange, monetary and financial situation. It is very urgent to resolve the related central bank issues.”
Credibility is the crux of the matter
Along the same lines, economist Claudio Juchowicki says the most important challenge anyone who takes office on December 10 is credibility. “Argentina has distorted relative prices, with many assets below their realizable value, the official exchange rate, energy, gasoline and more,” he says. According to Zuchovicki, the effect of this change is lack and, to change it, a lot of political power is needed. “They had to do things that neither of them said during the campaign,” he explains.
“There is no alternative but a reliable and durable stabilization plan,” says Juan Germano, director of Isonomy consulting firm. “There are no shortcuts either on the credit side or on the supply side, it’s over. Whoever is in power cannot tolerate the continued swings in the economic situation. Society is looking for a change,” he says.
Facundo Nezamkis, researcher and director of Opina Argentina, confirms that the crux of the problem is not economic, but political. “It’s true that inflation is a problem, and if you take out, you create inflation,” says Nejamkis. “The problem is, how do you fund public spending and who do you cut? The decision there is political,” he says.
New cycles in and out of the party
Whoever wins the presidency will face important social and macroeconomic challenges, especially controlling inflation, among others, and there are internal challenges to governing.
Sergio Massa’s potential mandate will ultimately face entirely different obstacles than those weighing on Millay’s government.
According to political scientist Andrés Malamud, the main challenges of the government of the current economy minister are not ahead, but different than what happened with the current president Alberto Fernández, Malamud says, “Massa will soon end up focusing on Cristina. On her real rival, who can challenge her for re-election, Axel Kicillof”, the current and Elected governor of Buenos Aires province and one of the most important leaders of the party.
In the same way, Nejamkis says, the main question is whether or not the official candidate, if he takes office, will usher in a new cycle in Argentine politics. “At one extreme, if we imagine a Massa who gives continuity to this and tries to rebuild reserves with very specific, but substantial gestures, it is difficult to imagine that he could create a leadership very different from the leadership of the Kirchner trio. Then Alberto Fernandez,” says the analyst. “Now, if Massa reconfigures the map of power and faces the birth of a new “ism” within Peronism, we must prepare for a long political cycle.”
Congress and Govt
In Miley’s case, additional challenges have more to do with Congress and governance. Malamud says the economist faces the dilemma of “forming a government with Macri on crutches” to implement the support of former President Mauricio Macri and his political allies at the legislative and regional levels. His project, Govt. In this sense, Nejamkis proposes two possible scenarios. “We will have to see if Millay wants to develop a program of disruptive measures or is closer to a classic anti-inflation model,” he clarifies and warns, if the first case occurs, “a period of great political and social conflict. Predicted.”
What awaits the new president in 2024
For now, the economic environment next year may hold some positive expectations. Economist Claudio Loser says that with no drought on the horizon, “the situation is very good in terms of agricultural production and exports,” and “oil and gas production and availability will increase with Vaca Muerta.” An advantage over either of the two presidential candidates. As with individual and International Monetary Fund debt maturities, this gives another breather to the already strained Argentine economy. “They have pushed forward a large part of the private debt, and despite the fact that the financed debt has to pay interest,” concludes the economist.
Again, a surprise election contest in Argentina leaves questions on the table. There are only a few days left to find out who will be the next president.