Argentina: Election Results Put Peronist On Top

Defying expectations, Argentina’s Peronist economy minister, Sergio Massa, notched a surprise win over libertarian outsider Javier Milei in the first round of the 2023 presidential election on October 22. The two candidates will face each other directly in a November 19 run-off, in what is expected to be a highly polarizing contest.

Whoever wins must steer the country out of one of its worst economic crises, as poverty grows and three-digit inflation rate rages.

Massa came out on top with 36.7% of the vote in the first-round while Milei reached 30%. A second anti-Peronist candidate, Juntos por el Cambio’s Patricia Bullrich, was eliminated after posting just 23.8%. Who will get the bulk of Bullrich’s votes is not known, but Alejandro Grisanti, an economist at Ecoanalitica, argues that “Melei reached a top, that he is unable to surpass.”

How is it Massa, the economic minister presiding over the current economic crisis, emerging as the winner on October 22? “Yesterday’s result shows how strong is Peronism, which is a mythical animal,” says Grisanti.

Public spending might provide a further explanation. As the campaign intensified in the final week, Massa plastered subway stations and train stops with signs saying a ride ticket would be 700 pesos under the no-subsidies policy that Milei supports, versus the current price of 59 pesos.

Massa’s strong showing “means that the run-up to the second-round vote in November is likely to see further pre-election give ways,” writes Kimberley Sperrfechter, emerging markets economist at Capital Economic.

Following elections, the winning candidate will move to the presidential palace on December 10. “Whoever next resides in Casa Rosada will face the tall order of pulling Argentina’s economy back from the brink,” says Sperrfechter, “something even a more market-friendly administration will find challenging. Whatever his flaws, Massa’s win represents certainty over uncertainty and the preservation of the status quo, Grisanti notes.