Argentine President Javier Milei to fire 70,000 government employees: Report

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Argentine President Javier Milei has announced plan to axe 70,000 government employees in the coming months, showcasing his aggressive "chainsaw-style" approach aimed at drastically downsizing the state, according to a report

Argentine President Javier Milei. Reuters File

Argentine President Javier Milei has announced plan to axe 70,000 government employees in the coming months, showcasing his aggressive "chainsaw-style" approach aimed at drastically downsizing the state.

According to a Bloomberg report, while addressing a gathering on 26 March, Milei disclosed his plan to halt public works, slash funding to provincial governments, and scrap over 200,000 social welfare programs, branding them as corrupt. These measures constitute a key component of the libertarian leader's strategy to achieve fiscal balance by any means necessary this year, added the report.

Despite the job cuts representing a mere fraction of Argentina's 3.5 million public sector workforce, Milei is poised to face resistance from influential labor unions.

Moreover, the move carries the risk of denting his high approval ratings, said the report.

A union launched a strike on 26 March, while a government report underscored the substantial wage decline experienced by private sector workers since Milei took office in December.

According to the report, the leader of the state workers union, ATE, promptly declared a nationwide strike on the social media platform X in reaction to Milei's proposals, though details were not provided.

Milei referenced surveys suggesting a rising optimism among Argentinians concerning the economy's prospects. Despite austerity measures, a recent gauge indicated a surge in public trust in the government.

During his speech, Milei also affirmed that peso futures contracts are in line with the central bank's 2% monthly crawling peg scheme, dismissing calls for a significant devaluation of the currency as "ridiculous."

He said the Argentine central bank is progressing towards achieving net neutral reserves, having started with debt liabilities exceeding available cash by $11.5 billion in December.

Milei expressed his commitment to intensify economic reforms post the 2025 congressional elections, with over 3,000 reforms in the pipeline.

He also praised the Senate's rejection of his emergency decree, seeing it as an opportunity to expose the alleged corruption of politicians he refers to as "delinquents."

Milei said that he anticipates a V-shaped economic recovery in the near future.

With inputs from agencies