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Argentina's Milei reopens ministry, restarts dialogue with opposition after electoral defeat

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  Published in Politics and Government on Thursday, September 11th 2025 at 5:28 GMT by Toronto Star
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Argentina’s Milei Reopens Ministry, Signals New Negotiations with the Opposition After Electoral Defeat

After a shocking loss in the 2023 primary elections, libertarian challenger Javier Milei has taken a surprising step: he is reopening the “Ministry of Economic Reform,” an office he shut down last month as a protest against the political establishment. The move, announced on Tuesday, signals a pivot from Mile i’s earlier confrontational posture to a more pragmatic approach that could open the door for dialogue with the country’s ruling coalition.

A Symbolic Reopening

Milei’s ministry—essentially a think‑tank and advisory body that he established to develop and promote his free‑market agenda—was shut in July when he publicly announced that he would not run for president in the December runoff. “It was a symbolic gesture of protest,” Milei said in a televised statement, “but the country needs solutions, not silence.” By reopening the ministry, he is now willing to engage the opposition and, according to him, “restore the debate about Argentina’s future.”

The ministry’s headquarters, which had been vacated after the primaries, has been re‑staffed with Milei’s closest aides. The organization will now act as a liaison between Milei’s libertarian platform and opposition parties, a fact that has already sparked speculation in the political press.

An Economic Agenda in the Face of Crisis

Milei’s proposals remain unchanged: a radical overhaul of the state’s role in the economy, including the elimination of subsidies, the privatization of key state‑owned enterprises, a drastic reduction in public spending, and the implementation of a flat‑rate tax system. The economic plan is detailed in an earlier piece linked in the original article, “Argentina’s Milei: The New Economics.” That piece explains how Milei intends to slash the current 60 % fiscal deficit and cut Argentina’s 93 % debt‑to‑GDP ratio, a figure that has been a stumbling block for the country’s economy for decades.

Argentina’s inflation is a key concern. According to data from the Argentine Central Bank, inflation has surged to roughly 70 % year‑over‑year, a record level that has eroded purchasing power and fueled widespread public discontent. Milei’s approach—cutting subsidies and tightening monetary policy—has drawn sharp criticism from labor unions and social‑movement groups, who fear that a sudden withdrawal of state support could deepen poverty and inequality.

Responding to the Opposition

The ruling Peronist coalition, which controls the National Congress and most provincial governments, has shown both wariness and willingness to engage. “We respect Milei’s right to propose policies, but we will not accept a plan that threatens social security and public services,” said a spokesperson for the Justicialist Party. The coalition has expressed openness to “constructive dialogue” with Milei’s ministry but warned that any collaboration would require a realistic assessment of the impact on the country’s social fabric.

The Prime Minister of the Opposition, a former Minister of Finance, said that while the reopening of the ministry could facilitate discussions, “the current political climate does not allow for hasty compromises.” Still, the fact that Milei is ready to negotiate could provide a new dynamic in the months leading up to the presidential runoff in December, which pits Milei against the incumbent’s choice for successor.

The Bigger Picture

Milei’s re‑opening of the ministry is more than a tactical move. It reflects a larger shift in Argentine politics, where the entrenched Peronist establishment faces increasing pressure from a younger, disillusioned electorate. The country’s long‑standing debt crisis, a staggering 93 % debt‑to‑GDP ratio and a chronic fiscal imbalance, has forced politicians on all sides to confront the hard question: how to balance a robust welfare state with the need for fiscal sustainability.

Milei has long championed a “new paradigm” that he argues will restore Argentina’s competitiveness and attract foreign investment. In a recent interview, he said, “The world is watching how Argentina deals with its challenges. If we choose to stay in the old pattern, we will remain mired in inflation and debt.” Whether the ministry’s reopening will translate into tangible policy changes remains to be seen, but the move undeniably marks a shift from protest to engagement.

What’s Next?

As Argentina approaches the decisive runoff, Milei’s strategy could influence the campaign’s tone. By reopening his ministry, he may attract voters who are weary of endless political grandstanding but who still fear the social fallout of an abrupt market‑driven reform. Conversely, his proposals may alienate traditional supporters of the Peronist party, potentially reshaping the electoral calculus.

In the coming weeks, the ministry will likely host a series of round‑table discussions with opposition lawmakers, economists, and civil‑society representatives. The outcomes of these meetings could set the stage for a broader coalition—or, at the very least, force the opposition to confront Milei’s policy proposals head‑on. For now, Argentine voters will watch closely as Milei turns from a confrontational figure into a pragmatic negotiator, testing whether a libertarian agenda can find footing in a country still grappling with the aftershocks of a decades‑long economic crisis.