On August 13, Argentina held its open, simultaneous, and mandatory primary elections (PASO), which determined the list of candidates representing each party. Three main political parties participated in the PASO, each with candidates who had markedly different profiles. 

The ruling party Unión por la Patria, led by Sergio Massa—the current Minister of Economy, who has a socialist profile and was once viewed favorably by the market—is in the midst of an inflationary spiral that is eroding what little credibility the current government had left. On the other hand, there is the Juntos por el Cambio party, which has historically been the ruling party’s rival. Running for this party were Horacio Rodríguez Larreta, also a social democrat, and Patricia Bullrich—who advocates pro-market policies, reduced public spending, and a greater emphasis on security—and who performed well as Minister of Security during the Macri administration. Finally, running for the “La Libertad Avanza” party was Javier Milei, who describes himself as a liberal-libertarian, whose most notable proposal is free currency competition (likely dollarization), with the eventual closure of the Central Bank.

No polling firm predicted the victory of La Libertad Avanza, where Javier Milei won 30.04% of the vote, when they had forecast a distant third-place finish. He was followed by Patricia Bullrich of Juntos por el Cambio, who received 28%, and Sergio Massa of Unión por la Patria, who received 27.27%. Thus, these primaries turned out to be Peronism’s worst election in history—a significant development that could mark a turning point for the country.

The general election will be held on October 22, and to win the presidency, a candidate must receive more than 45% of the vote or 40% with a margin of at least 10% over the runner-up. If that does not happen, a runoff election will be held on November 19. In this scenario, there are two questions to ask: what are each candidate’s chances, and what can we expect going forward if one or the other wins?

To answer the first question, we must keep in mind that Milei received 7 million votes, and it is likely that, due to the “triumphalist contagion” effect, he will manage to capture some of the 10 million votes that were split between those who cast blank ballots and those who did not vote at all.

On the other hand, it is more difficult to predict who might win the election if the race is between Patricia Bullrich and Sergio Massa. The Juntos por el Cambio candidate received 4 million votes on her own and is expected to capture a high percentage of the 2.7 million votes cast for her rival from the same political party, Horacio Rodríguez Larreta. 

Despite Sergio Massa's poor performance—he received 5 million votes—it is possible that he will attract another segment of undecided voters who voted for Rodríguez Larreta, so it remains unclear who will have the upper hand.

In conclusion, Argentina’s political landscape is currently marked by uncertainty and transition. Each candidate offers a different path for the country. If Massa wins, the situation will likely not change much, with the country closed off to trade, massive public spending, no support for the private sector, and a divided Congress. If Bullrich wins, we will see a more radical change than under Macri. Having learned the lesson that gradual adjustments do not work, there would be economic openness, independence for the Central Bank, and greater market confidence. As an established party, it offers certainty in terms of governability and would have the support of Milei’s party in Congress.In the event of a victory by Milei—whose lack of a team and track record is being questioned—he would also need Bullrich’s support for reforms, though he is bringing together very capable people on his team (such as economist Carlos Rodríguez, among others). Ultimately, it is unclear who will win. The three candidates are neck and neck, but what is clear is that there is a profound shift in society’s mindset, one that demands urgent reforms aligned with the ideals of freedom.

Pablo Gonella

Cash Desk Operator