The election of right-wing candidate Mauricio Macri as Argentina’s president on Sunday, which just a few months ago was unexpected, is a setback for Argentina and for the region. In the last 13 years, Argentina had made enormous economic and social progress. Under the Kirchners (first Néstor and then Cristina Fernández de Kirchner), poverty fell by about 70 percent, and extreme poverty by 80 percent. (This is for 2003 to mid-2013, the last year for which independent estimates are available; they are also based on independent estimates of inflation.) Unemployment fell from more than 17.2 percent to 6.9 percent , according to the IMF.
But Daniel Scioli, the candidate of the Peronist “Front for Victory”, who represented the governing coalition including President Fernández, did not do a good job defending these achievements. He also didn’t seem to make clear what he would do to fix the country’s current economic problems. In the past four years, growth has been slow (averaging about 1.1 percent annually), inflation has been high (with private estimates in the 20s), and a black market for the dollar has developed. This gave Macri (and his “Cambiemos” or “Let’s Change” coalition) an opening to present himself as the candidate of a better future.
With skilled marketing help from an Ecuadorean public relations firm, he also succeeded in defining himself as something far more moderate than he is likely to be, thus winning over voters who might otherwise be afraid of a return to the pre-Kirchner depression years.
Some of the things he has indicated he would do could have a positive impact, if done correctly. He will likely cut a deal with vulture funds who have been holding more than 90 percent of Argentina’s creditors hostage since New York judge Thomas Griesa ruled in 2014 that the government is not allowed to pay them. If the cost is not too high, it could be a net positive by re-opening a path for Argentina to return to international borrowing — something that Scioli would likely have also done.