Inflation to be 'more than a bad memory': Argentina President eyes US trade deal

Argentine President Javier Milei pledged to curb inflation and pursue a free trade deal with the US in 2025, despite rising poverty and harsh austerity measures under his economic reforms.

In Short

• Argentine President promises major tax reform and removal of currency controls
• Vows to cut export taxes from 2025 for agricultural sector
• Austerity measures have reduced inflation but increased poverty

Argentine President Javier Milei promised Tuesday that inflation will soon be "little more than a bad memory" and vowed to pursue a free trade deal with the United States next year.

"Happy times are coming in Argentina," Milei said in a televised speech, in which he celebrated progress on monthly inflation which has dropped under his cost-slashing agenda, even as poverty has risen.

Milei said his government will seek a free trade agreement with the United States next year and added he will use his rotating presidency of the Mercosur economic bloc to boost the autonomy of its members to make deals.

The self-proclaimed "anarcho-capitalist" also promised a tax reform that would reduce national taxation by 90 percent, and vowed to eliminate Argentina's strict currency controls so that people can "use the currency they want in their daily transactions."

On Tuesday morning, Milei promised to cut taxes on exports from 2025 during a meeting with leaders of the Argentine Rural Society, the entity that brings together the large landowners of one of the main food producers in the world.

Since taking office in December, Milei's government has applied a drastic austerity program with the aim of eliminating the budget deficit and taming chronic inflation.

It has slashed subsidies for transport, fuel and energy, even as thousands of public servants lost their jobs.

While monthly inflation dropped to a three-year low in October, the annual figure of 236.7 percent in August remains one of the highest in the world.

Poverty rose to 53 percent of the population in the first half of 2024 -- up 11.2 percentage points under Milei.