Argentine President Javier Milei, who made shock waves after taking power in his country and dealing with a deep economic crisis, now faces severe backlash for a growing bribery scandal involving his sister.
Milei has denied any wrongdoing and has labeled the issue “the most rancid political tricks.”
The accusations alone would be enough to rock his presidency, but the timing also threatens to deeply undermine him with two key elections scheduled in the next two months and his popularity cratering among the electorate.
Milei, on Wednesday, had to leave a rally early after protesters started throwing small rocks, bottles, and other objects at the pickup truck on which Milei and his sister stood.
Juan Mabromata/AFP via Getty Images
Why It Matters
Milei implemented a series of austerity measures, which included slashing energy and transportation subsidies, laying off tens of thousands of government workers, freezing public infrastructure projects, and imposing wage and pension freezes below inflation. These changes initially caused unemployment to climb, economic activity to decline, and poverty to surge.
However, sticking to his policies ultimately led to a decline in monthly inflation, which caused bonds to rally and the currency to strengthen, all of which has brought Argentina’s country-risk index, an influential measure of the risk of default, to its lowest point in five years.
Argentina’s reserves at the central bank reached their highest levels in two years, bolstered by International Monetary Fund credit, and the country’s GDP has grown at rates that defied predictions from financial institutions, which had forecast stagnation.
However, wages remain too low and prices too high, with poverty still at an elevated level, for many to accept the current status as an outright win for the people of Argentina; however, many have agreed that the country is on the right track to reverse many of the economic ills that plagued it.
U.S. President Donald Trump has made no secret of his admiration for Milei, and the Argentine president was the first foreign leader to visit Mar-a-Lago after Trump won the 2024 presidential election. Milei also praised Elon Musk for his efforts to help Trump win the election, saying the tech mogul was going to “save humanity.”
What To Know
Milei, a populist and self-declared “anarcho-capitalist,” fired the director of Argentina’s disability agency, Diego Spagnuolo, after Spagnuolo was caught in recorded audio reportedly discussing a kickback scheme.
The alleged scheme involved Milei’s sister and close adviser Karina Milei and other senior officials taking up to three percent kickbacks on disability drug contracts, totaling as much as $800,000 a month.
The audio leaked to local media and has inflamed outrage against the embattled presidency, which saw the country’s dollar bonds stall earlier this week amid the fallout of the scandal, according to Bloomberg. The bonds have become the worst performers in emerging markets over the previous week.
Argentina faces two key elections in the coming months: local races in Buenos Aires on September 7 and midterm elections on October 26, which will see half of the Chamber of Deputies and a third of the Senate up for reelection—a virtual referendum on Milei’s government.
Milei’s spokesman, Manuel Adorni, posted an image to X and highlighted an object that appeared to be hurtling toward Milei, writing in Spanish, “They could have killed anyone. They don’t care about human life, much less are they going to care about the country.”
“Militants of the old politics, pure Kirchnerism, and a model of violence that only the cavemen of the past want: they attacked with stones the caravan where the President of the Nation was located,” Adorni wrote in another post. “There are no injuries. The only thing there is, is many who are heading toward the most absolute of oblivions: Kirchnerism never again.”
Krichner refers to former Argentine President Nestor Kirchner and his widow, Cristina Fernández de Kirchner, of the Justicialist Party, who also served as president.
Another campaign event, this one featuring Karina Milei alone, grew tense on Thursday as protesters clashed with her supporters, prompting security to whisk her away to safety inside a black van. Police reported at least three arrests at the protest.
This article includes reporting by The Associated Press.
Correction 8/29/25, 3:17 p.m. ET: This article’s headline was updated with the correct spelling of Javier Milei. The article was also updated with additional information.
