© Reuters. Argentine presidential candidate Javier Milei of La Libertad Avanza party speaks during the closing event of his electoral campaign ahead of the presidential election, in Buenos Aires, Argentina, October 18, 2023. REUTERS/Matias Baglietto/File Photo
By Lucinda Elliott and Jorgelina do Rosario
(Reuters) – Exciting news from Argentina as President Javier Milei sends a comprehensive reform bill to Congress, outlining ambitious changes to the country’s tax system, electoral law, and public debt management.
This push to reshape South America’s economy requires approval from lawmakers, where Milei’s coalition holds a small minority of seats.
WHAT ARE THE MAJOR REFORMS IN THE BILL?
The bill includes 664 articles, allowing privatization of 41 public companies, scrapping the presidential primary vote, and introducing a broad 15% tax on most exports.
The government also hopes to raise export taxes for soy and its derivatives to 33% from 31%. Argentina is the world’s No. 1 exporter of processed soy.
A reform to public debt management would remove limits on sovereign bonds issued overseas and eliminate some conditions on restructuring debt. The changes to Argentina’s proportional representation electoral system would also give more power to certain districts in the lower house of Congress.
WHAT ABOUT MILEI’S PRESIDENTIAL DECREE?
Markets have welcomed a presidential decree from Milei to deregulate the economy, including wide-ranging reforms such as the end to export limits.
Unlike the reform bill, the presidential decree does not include changes to the tax and the electoral system, which must be put to congressional debate under Argentina’s constitution.
HOW LONG COULD IT TAKE TO PASS THE REFORM BILL?
Milei’s government sent the bill to Congress on Wednesday and has called for extraordinary sessions to fast-track its reform agenda.
The extraordinary sessions are scheduled through Jan. 31, shortening the usual recess until March. Lawmakers will set up commissions to analyze the proposals, which may include input from experts and government officials.
Several of the measures proposed require an absolute majority, such as electoral reform, which analysts warn could slow the process down.
