On 14 November Argentina’s opposition right-of-centre Juntos por el Cambio (JxC) claimed victory in the mid-term congressional elections which took place the same day.
Analysis:
With over 90% of votes counted, the elections, for 24 seats in the 72-member senate and 127 seats in the 257-member chamber of deputies, have delivered a heavy defeat for President Alberto Fernández’s ruling left-of-centre Frente de Todos (FdT) coalition whose driving force is the Partido Justicialista (PJ, Peronists). Peronists look to have lost their majority in the senate for the first time in almost four decades. In the lower chamber vote, the FdT lost key provinces such as Buenos Aires, a traditional Peronist stronghold. The result, which follows FdT’s shock defeat in the September congressional primaries (Paso), makes it much harder for President Fernández to govern ahead of the 2023 presidential election, not only because he lost the senate majority, but because the poor showing is likely to deepen a rift within the Peronists. Vice President Cristina Fernández (who was president from 2007-2015) blames Fernández for not being interventionist enough. She may now demand more unorthodox policies to combat high inflation and poverty.
- According to preliminary results, the FdT’s presence in the senate looks to drop from 41 seats to 35, two votes short of the 37 needed to form a majority and approve legislation on its own. The JxC looks to have won in six of the eight provincial races (Corrientes, Córdoba, Santa Fe, Chubut, La Pampa, and Mendoza) with Catamarca and Tucumán going to the FdT.
- There was less significant change in the lower chamber where the FdT looks to have lost two seats but remains the strongest force with 118 seats against 116 for JxC, although it narrowly lost in the PJ bastion of Buenos Aires province and other traditional strongholds.
- Nationally, with 98.84% of the votes counted, the media is reporting that JxC won 41.97% of the vote to 33.57% for FdT. Yet the government still maintained victory claiming that this was still an improvement on the 32.43% won in the Paso vote. “I ask you, next Wednesday when we remember the day of the activists, let’s fill the Plaza de Mayo and celebrate this victory the way it should be,” President Fernández told supporters at FdT headquarters.
- He also called on the opposition to engage in dialogue and said he would announce an economic programme next month that would seek to put public finances in order. However, he signaled that this would not include austerity measures that would cause hardship or inequality.
- Finding a solution to the US$44bn owed to the International Monetary Fund (IMF) is one of the top priorities, he said. “This is the biggest obstacle we face to continue the path of economic recovery.” He cautioned that talks require patience and that “negotiating doesn’t mean obeying.”
- Fernández had increased social welfare spending and froze prices on 1,432 basic products in an effort to ease rising discontent ahead of the elections. Still confidence in economic policy dropped, with the Argentine peso losing half its value in two months to trade at Ar$198 to the US dollar on the black market.
Looking Ahead: Analysts will be closely monitoring Cristina Fernández, who many consider to hold the real power in government, for any signs that she is pushing for more populist economic measures in response to the electoral defeat. Her position will dictate the tone of the pending economic plan and will have implications for negotiations with the IMF, which will be closely watched by investors.