President Milei’s extensive overhaul works to reactivate investment and rebuild trust in Argentina

Contrary to the coverage of opposition media, in the hands of President Javier Milei and his libertarian model, Argentina is showing clear signs of recovery and seeing a historic change in macroeconomic indicators. This follows years of stagnation, uncontrolled inflation and structural imbalances. As published by Argentinian-based digital news outlet La Derecha Diario, according to data from the National Institute of Statistics and Cenuses, the country’s GDP (gross domestic product) increased by 5.8% year-on-year in the first quarter of 2025.

“This growth is not an isolated phenomenon, but part of a consistent pattern that spans various areas of the real economy. Private consumption, the main driver of domestic demand, increased by a remarkable 11.6% year-on-year in the same period. Even more noteworthy is the growth in investment, measured as gross fixed capital formational, which reached an extraordinary 31.8% year-on-year. This level of investment is especially relevant, as it indicates renewed business confidence in the macroeconomic climate and in the sustainability of the structural reforms implemented,” reads the source.

Milei, who took office in December 2023 amid crisis, has proposed an overhaul of Argentina’s fiscal and structural policies and worked to reactivate investment and realign incentives – while rebuilding trust among its people. Displaying a direct leadership style that challenges the status quo and measurable results, the “the Milei effect” is now transcending borders.

Given the fact that Argentina’s last center-right president, President Mauricio Macri, attempted to lead based on a comparable ideology and failed, John Price, Managing Director at Americas Market Intelligence, calls Milei’s experiment interesting. The difference: the popularity of Milei. “He’s in front of a microphone every day talking about concrete achievements made in the last 24 hours…He is constantly reminding people of the progress that’s being made,” says Price. By controlling and driving the narrative, the president keeps people off the street, keeps unions at bay and manages to continue governing despite his party having a very small number of seats in Congress. Price notes as long as President Milei holds the support of 50% of the population than Argentina’s governing bodies and courts will not turn against him.

The removal of currency controls in Argentina earlier this year is also a key differentiating factor. This now allows hedge funds and pension funds to send money into the country’s capital market and buy assets, thereby strengthening its currency, generating investment and giving purchasing power to the average Argentine. According to Price, this applies not only to extractive sectors such as mining, oil, gas and agriculture, but also to the retail economy which has been under invested in for over a decade. Price expresses, “We’re seeing investments in new stores and investments in the service economy and this is the gamechanger that everyone [has been] waiting for in Argentina.”

Speaking about the effect of Argentina’s evolution abroad, Price says, while Milei’s policies will definitely have an impact on other countries in the region, he doesn’t expect to see Libertarian parties necessarily winning elsewhere. “[As a political concept, it’s still under developed, but it will be hard for the next government in Chile, Colombia or Ecuador to ignore what’s going on in Argentina. They will see the success there, then they will have the political courage to make the dramatic cuts that have been a big part of Milei’s turnaround.]”

Potential for sustained growth

According to m1nd-set data, 257 million international flights are forecasted in 2025 across Latin America, reaching 119% recovery versus 2019. Discussing contributing factors, Enrique Urioste, President & CEO, Latin America & Caribbean, Avolta, believes this figure reflects broader shifts that have emerged post-pandemic including the rise of bleisure travel and the change in work-life balance mindset among younger generations. “These changes in mindset and flexibility are helping drive the resurgence in international travel. At this stage, we don’t anticipate significant impact on these forecasts from current geopolitical tensions, however we continue to monitor the situation closely,” he shares.

On the Trump administration’s travel ban leading to the halting of tourism traffic flow of legal residents to Latin America and the Caribbean, Urioste expresses as with many other disruptions, the retailer can expect this situation to normalize over time. “The benefit of our business model is our scale, which gives us resilience: travelers continue to travel, and while disruptions may disrupt, we continue to see that travelers simply adapt their travel to a different location,” he notes.

According to the Urioste, Latin America’s travel sector has strong long-term potential, especially if political and economic stability continues. With rising demand in markets like Brazil, Argentina and the Caribbean, the region is well-positioned for sustained growth. He says, “We are ready to meet the needs of the travelers to Latin America, and together with our partners, continue to work to make a travel experience revolution come to life.”