Argentina Senate Narrowly Approves President's Ambitious Reform Plan

Police line up during clashes with anti-government protesters outside Congress where lawmakers debate a reform bill promoted by Javier Milei in Buenos Aires, Argentina, Wednesday, June 12, 2024. (AP P

Argentina's Senate has given provisional approval to President Javier Milei's sweeping proposals aimed at cutting spending and expanding presidential powers. The narrow vote of 37 to 36, with a tiebreaking vote from Vice President Victoria Villarruel, marks a significant step for Milei's administration.

The proposed legislation includes a 238-article state reform bill that declares a one-year state of emergency and grants the president broad powers in key sectors until the end of his term in 2027. Additionally, the bill introduces an incentive scheme offering tax breaks to investors for 30 years.

Milei, a political outsider with limited legislative experience, has faced resistance from opposition lawmakers. His party, Liberty Advances, holds a minority of seats in both the lower house and the Senate.

Senate vote of 37 to 36 with Vice President's tiebreaking vote.

President Milei's proposals aim to cut spending and expand presidential powers.

Proposed legislation includes a state reform bill and tax breaks for investors.

Milei faces opposition due to economic challenges from previous actions.

Protests express concerns about potential losses in labor and pension rights.

Success of reforms depends on building political consensus and attracting foreign investment.

Administration aims to negotiate a new agreement with the IMF to address debt.

Opposition remains strong despite concessions made by Milei's allies.

Labor unions and activists oppose reforms, emphasizing protection of national assets.

The president's previous actions, such as cutting subsidies, reducing public sector jobs, and devaluing the currency, have led to economic challenges. The country is experiencing a deep recession, with poverty levels at 55% and annual inflation nearing 300%.

Protests erupted ahead of the Senate vote, with demonstrators expressing concerns about potential losses in labor and pension rights. Critics argue that Milei's reforms may further exacerbate economic hardships for ordinary citizens.

Analysts suggest that the success of Milei's reforms hinges on building a political consensus and attracting foreign investment. The administration aims to negotiate a new agreement with the International Monetary Fund to address Argentina's existing debt of $44 billion.

Despite concessions made by Milei's allies, including the decision not to privatize certain state-owned enterprises, opposition remains strong. Labor unions and activists have voiced opposition to the proposed reforms, emphasizing the importance of protecting national assets.

The outcome of the Senate vote sets the stage for further deliberations on the bill's specific provisions. The legislation will return to the lower house for additional review before potential implementation.