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New president breathes life into Argentine economy

The capital Buenos Aires, which literally means ‘good air’, apparently got its name from early Spanish settlers who established themselves on a hilltop above the old city to escape the swampy, foul-smelling lowlands on the coast.

According to others, the name derives from the ‘fair winds’ that
would carry sailors through the Río de la Plata into the port town of Buenos Aires. It is the latter I find most appropriate following my trip there.

Argentina is a country that has been facing significant headwinds for more than a decade now, following its social and economic collapse at the turn of the century. With a new government
in place, reformist policies and aggressive economic rebalancing, the winds may finally be changing for Latin America’s second-largest country. 

Fresh start

For Argentina, 2015 was a crucial year of political transition, ending more than 12 years of populist and increasingly authoritarian rule under the Kirchners. The country transitioned into a new era of government with the appointment of wealthy entrepreneur Mauricio Macri as president, and, more importantly, managed to do so without triggering a political or
economic crisis in the process.

The change was significant. A small, centre-right and pro-market party won the presidential election against the entrenched and dominant political force in the country.
The key reason was the loss of Buenos Aires, which accounts for over 40% of the country by both population and GDP, and it has historically been a Peronist stronghold (including the 12
Kirchner years).

There is still an uneasy coalition ruling the country but the new government has shown a willingness and capacity to implement change.
Many of the new breed of young politicians come from the private sector and are motivated by the need for change. They are also less hampered by ideology and party factionalism.
A well-organised and rational opposition are keeping the government on its toes, but without hindering the desperately needed reforms.

The results are clear: since the new government came to power more than 52 laws have been passed following discussion and amendment with the opposition. Based on this we believe the coalition is working.

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Part of the Mark Allen Group.