Full Breakdown
Argentina's Congress Approves 2026 Budget Under President Javier Milei
12/29/2025, 9:56:13 PM
Legislative Milestone for Javier Milei
On December 26, 2023, Argentina's Congress approved the 2026 budget proposed by President Javier Milei, marking the first budget passed since his election. The Senate voted 46 in favor, 25 against, with one abstention, following approval from the lower Chamber of Deputies. This budget includes $102 billion in spending and projects a 5% economic growth rate alongside an inflation rate of 10.1%. It aims for a primary budget surplus of 1.2% of the gross domestic product, a significant shift from the previous years when Milei's administration extended the 2023 budget without legislative approval.
Background and Context
Milei's administration has been characterized by austerity measures aimed at stabilizing Argentina's economy, which has faced severe inflation, peaking at nearly 300% in April 2024. The newly approved budget reflects a 7% increase in real terms from the previous year but represents a 24.6% decrease compared to the 2023 budget. The Civil Association for Equality and Justice, a Buenos Aires-based think tank, noted that while the budget increases funding for social services, it does not fully compensate for the cuts experienced in recent years.
Political Dynamics and Support
The approval of the budget is seen as a demonstration of Milei's political strength following his party, La Libertad Avanza, gaining significant power in the October midterm elections. The party now holds a substantial minority in the lower house and has increased its representation in the Senate. This legislative victory is crucial for Milei as he seeks to implement further reforms, particularly in labor and tax systems, in the coming months.
Criticism and Opposition
Despite the budget's passage, Milei's austerity measures have sparked widespread protests across Argentina. Critics argue that the cuts to social services and public funding are detrimental to vulnerable populations. In particular, the rejection of provisions related to disability programs and university funding has drawn ire from various sectors. Lawmakers in the lower house removed these controversial chapters to secure broader support for the budget.
Official Statements & Responses
Senator Ezequiel Atauche, a member of Milei's party, emphasized the government's commitment to fiscal responsibility, stating, "We are not going to spend more than we make, we are going to get our accounts in order." Milei himself acknowledged the significance of the budget's approval, indicating that it would allow for necessary reallocations of expenses to address the rejected articles.
What's Next
Looking ahead, lawmakers are set to debate Milei's proposed labor reforms in February 2024, which will likely be influenced by the budget's fiscal policies. The approval of the budget also positions Argentina favorably regarding its $20 billion agreement with the International Monetary Fund, as it aims to maintain a fiscal surplus moving into the new year.
Verbatim Quotes
- “We are not going to spend more than we make, we are going to get our accounts in order,” — Senator Ezequiel Atauche, La Libertad Avanza
This budget approval represents a pivotal moment for President Milei as he navigates the complexities of governance amid economic challenges and public dissent.
