Photo: Reproduction
Sergio Massa received 36% of the valid votes, while the farright candidate Javier Milei received 30%.
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On November 19, Argentines will go to the polls to elect the next president of the republic. The candidates of the 2nd round are opposites: the controversial MP Javier Milei, who represents the extreme right, and the current Minister of Economy Sergio Massa, who represents Peronism. Argentina is losing importance in Brazil’s trade balance every year and this election will also decide the future of its relations with Brazil.
In 2022, Brazil recorded a trade surplus of $2.2 billion with Argentina, just over a quarter of the $8.1 billion in 2017.
Argentina is the second largest buyer of Brazilian products after China and the United States. Brazil lost its position as Argentina’s largest importer to China.
This scenario could change depending on the election results next month, as government candidate Sergio Massa maintains good relations with Brazil, but ultraright Javier Milei criticizes President Lula and the Brazilian economy.
Massa is the man at the forefront of the unprecedented crisis that the country is going through, with inflation exceeding 100% in 12 months, coupled with an exchange rate devaluation of almost 150%. If elected, he promises not only a stabilization of the exchange rate, but also a more equitable distribution of income with investments in social programs and public education.
Milei, in turn, describes himself as an anarchocapitalist and his banner for solving the economic crisis is the dollarization of the economy and the abolition of the central bank. The “Argentinian Bolsonaro”, as he is known in Brazil, guarantees that he has a plan to transform the country in three phases that would last 35 years and are based on cost cutting and a downsizing of the public sector.
According to Roberto Uebel, professor of international relations at ESPM, Massa is more rational and knows the institutions better to negotiate a way out of the crisis, while Milei “uses simple and populist arguments to find solutions to very complex problems.” .
“For example, the closure of the central bank, the complete dollarization of the economy, the break with Mercosur and China, the departure from Brazil. This shows that, although Milei is an economist, he has a great lack of knowledge about how governance institutions work. “Economic policy,” he comments.
With regard to the economic policy proposals of the ultraright, Uebel emphasizes that not even countries with a liberal economy have anything comparable in their literature to what the MP is defending.
“Argentina does not have enough reserves to dollarize its economy. It also has a very serious problem in terms of its economic matrix, which is very foreignoriented. It is an agricultural exporter, just like Brazil. “So any fluctuation in the exchange rate would have a direct impact not only on the Argentine producer and exporter, but also on the ordinary citizen who buys newspapers at the corner newsstand,” he says.
How Brazil will be affected
Brazilian Finance Minister Fernando Haddad (PT) admitted that a possible victory for Javier Milei in the Argentine elections worries the Brazilian government, as the country is not only a neighbor but also one of Brazil’s most important trading partners.
“It’s completely natural [preocupado]. A person whose flag is to break with Brazil, a relationship built over centuries, is worrying. “It’s natural,” Haddad said in an interview with Portal. “It would worry everyone because in international relations generally you don’t ideologize the relationship.”
Despite Haddad’s concerns, Uebel believes that little will change in trade relations between the countries. If Massa wins, he should carry on as before, but even with Milei at the helm of Casa Rosada, “money doesn’t see ideology.”
“The third Lula government was very pragmatic in foreign relations. I would not doubt that Lula will be inaugurated if Milei is elected. “Over the last four years, we have been committed to maintaining a dialogue with every country, regardless of the ideological political line of that country’s ruler,” explained he.
“And not only that, the companies themselves don’t look at it, they obviously pay attention to everything, but in negotiations it is the company with the company and that is irrelevant in the end, especially because our agribusiness and the Brazilian industry are them.” “We depend heavily on Argentina, but Argentine agriculture and industry also depend heavily on Brazil,” he adds.
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