On Friday, the Argentine Congress passed the 2026 budget, marking the first budget approved by Congress since President Milei took office at the end of 2023.
According to reports from Reuters, the budget amounts to $102 billion (148 billion Argentine pesos) and was approved with 46 votes in favor, 25 against, and 1 abstention. The second-largest economy in South America is expected to achieve 5% economic growth with an inflation rate of 10.1%. The bill predicts a primary budget surplus of 1.2% of the gross domestic product.
In the first two years of Milei’s term, the government only extended the 2023 budget without congressional approval, leading to severe inflationary impacts on various industries, with the annual inflation rate nearing 300% by April 2024.
According to a report from the “Association for Civil Rights” think tank in Buenos Aires, the new budget represents a real increase of 7% compared to the 2025 fiscal year but a real decrease of 24.6% compared to the budget approved by Congress in 2023. The think tank also noted that some inflation forecasts far exceed those of the executive branch.
Since taking office at the end of 2023, Milei has implemented comprehensive austerity measures, sparking large-scale protests repeatedly. Argentina achieved its first budget surplus in over a decade in 2024.
This year, Congress overturned Milei’s veto power on several bills aimed at increasing funding for public universities, children’s healthcare, and disability-related expenses.
Last week, thousands of people took to the streets of Buenos Aires to protest the government’s proposed labor law reform.
The Association for Civil Rights highlighted in its report that while the new budget increases allocations for healthcare, social security, and education, the increments are still insufficient to make up for significant cuts in recent years.
Milei’s “Freedom Forward Party” won a significant victory in the midterm elections in October, gaining considerable influence in the newly elected Congress. The government hopes this momentum will drive a series of reforms in the coming months, including labor law and tax reforms.