Argentina's President Javier Milei wins midterm elections closely watched by Washington

Argentine President Javier Milei's La Libertad Avanza party won over 40% of votes in Sunday's midterm elections, securing a congressional majority that strengthens his free-market reforms after US President Donald Trump promised $40 billion in aid contingent on his ally's electoral success.

Milei’s ruling party will now hold almost half of the seats in the lower house of the Argentinian Congress, according to tallies in local media based on figures from electoral authorities, with more than 97% of votes counted.

Milei won decisive victories in key districts, sweeping away eight provinces in the vote to renew a third of the Senate, figures that exceeded analysts’ projections for Sunday’s vote.

The election, commonly regarded as a de facto referendum on the self-described anarcho-capitalist's nearly two years in office, offered a crucial vote of confidence that strengthens Milei's plan for a radical free-market experiment, backed by billions of dollars from the Trump administration.

In comparison, the results showed the left-leaning opposition movement, known as Peronism, winning over 31% of the vote, a performance analysts described as the alliance’s poorest in years.

Milei said his party went from holding just 37 seats in the lower house of Congress to 101 after Sunday’s vote. In the Senate, La Libertad Avanza had picked up 14 more seats, bringing its total to 20 senators.

The strong showing ensures Milei will have enough support in Congress to uphold presidential vetoes, prevent an impeachment effort, and see through his ambitious plans for tax and labour reforms in the coming months.

Milei: Argentina has turned a new page

On Sunday evening, at his party headquarters in downtown Buenos Aires, Milei burst onstage and sang a few lines of the death-metal tune that has become his anthem, “I am the king of a lost world”.

Beaming as his supporters cheered, he seized on the results as evidence that Argentina had turned the page on decades of Peronism that brought the country infamy for repeatedly defaulting on its sovereign debt.

“The Argentine people left decadence behind and opted for progress,” Milei said, thanking “all those who supported the ideas of freedom to make Argentina great again.”

Even though voting is compulsory, electoral authorities reported a turnout rate of just under 68% Sunday, among the lowest recorded since the nation’s 1983 return to democracy.

Milei, an ally of Trump

After decades of budget deficits and protectionism, Milei, a crucial Trump supporter who has cut state expenditure and liberalised Argentina's economy, had a lot riding on Sunday's elections.

Since the Peronist opposition's significant loss in a provincial election last month alarmed markets and triggered a peso sell-off that prompted the US Treasury's unusual intervention, Milei's government has been frantically trying to prevent a currency crisis.

A series of scandals — including bribery allegations against Milei’s sister, Karina Milei — hurt the president’s image as an anti-corruption crusader and hit a nerve among voters reeling from his harsh austerity measures.

But after meeting with Trump earlier this month at the White House, days after the United States agreed to give the South American country a multi-billion-dollar financial lifeline, things seemed to take a new shape for Milei.

While reports suggest inflation has dropped dramatically from an annual high of 289% in April 2024 to 32% last month due to the budget cuts, many Argentines are still having difficulty making ends meet.

Since Milei lowered cost-of-living increases, price hikes have surpassed wages and pensions. With Milei's removal of subsidies, households now pay more for public transportation and electricity.

The unemployment rate is now higher than when the libertarian president took office, according to local media reports.