Milei accelerates reforms, tests alliances amid investor shifts

Argentine President Javier Milei is pushing forward with his reform agenda, seeking to consolidate his position and test political alliances after a significant cabinet shift. The recent departure of Manuel Adorni from the government has reportedly altered the conversation with international investors, who are now showing renewed interest in Argentine assets.

Executives from companies with substantial investments in Argentina note a change in investor sentiment since Adorni left. Previously, concerns focused on the impact of his policies on confidence indicators. Now, with improved consumer confidence metrics and Adorni's exit, foreign investors perceive greater attractiveness in the country's assets, though domestic investors remain more cautious.

This shift is seen as a boost for the government, allowing it to regain control of the public agenda and focus on its economic priorities. Investors anticipate a potential window of financial opportunity, partly due to a slightly less appreciated peso, which makes peso-denominated investments more appealing.

The administration is preparing to introduce a new, comprehensive deregulation bill. This legislation is expected to encompass many of the regulatory changes previously championed by Federico Sturzenegger's ministry, which faced judicial challenges. The bill may also introduce novel reforms in sectors such as capital markets, drawing inspiration from changes implemented in the United Kingdom.

Sources indicate the bill could address around fourteen key areas. Among these are potential reforms to the Cabotage Law, aiming to allow foreign vessels to transport goods between Argentine ports. The government also intends to legally solidify proposals previously enacted by decree or resolution but later suspended by the judiciary. One such proposal seeks to permit the sale of over-the-counter medications outside of traditional pharmacies, a measure that was part of a previous decree and later blocked by a preliminary injunction.