President presents 2025 Budget, says zero deficit is a must

President Javier Milei presented his 2025 Budget to a half-empty Congress late Sunday night in a primetime speech, with the La Libertad Avanza promising to veto any law that threatened his strict goal to reduce the country's fiscal deficit to zero.

"The deficit has always been a consequence of thinking first about how much to spend and then how to finance it," said Milei in a speech broadcast nationwide.

"We are going to do it the other way around: thinking first about how much we have to save, and then see how much we can spend," he added.

“Any expenditure that is created and does not explain from which existing budget line it will come from will be vetoed.

"We will veto all the bills that threaten the fiscal balance, because we will not be accomplices in swindling the Argentine people," Milei warned in a typically outspoken speech that criticised opposition lawmakers.

Since taking office in December, the budget-slashing Milei has applied a drastic austerity programme in a bid to rein in chronic inflation and decades of government overspending.

Congress was half-empty, with a number of opposition members skipping what they called a "staged" event. It is the first time a president has presented the Budget – a task normally carried out by the economy minister.

Milei's party is in a minority in Congress and divided. While the president has faced setbacks in some of his budgetary policies, he notched a victory last week when lawmakers upheld his veto of a bill to increase pensions.

Argentina's government recorded a fiscal surplus of 0.4 percent of GDP in the first half of the year.

Under Milei's reforms, inflation for August stood at 4.2 percent, the fourth consecutive month under five percent and a massive drop from the 25.5 percent recorded in December.

Year-on-year inflation however was still sky-high at 236.7 percent.

Critics say the steep drop in inflation and other apparent economic wins have come at the cost of the poor and working classes, and due to a strangling of the economy.

Consumption has slumped more than 15 percent so far this year, according to business chambers.

The government says it expects Argentina's economy to grow by five percent next year (above the International Monetary Fund's forecast of 3.5 percent) and forecast inflation of just 18 percent next year.

In his 30-minute speech, Milei restated his vision of a national state focused on macroeconomics and security, declaring that "management means shrinking the state to enlarge society."

"We are not exaggerating when we say that we have made the biggest adjustment in the history of humanity," said the President.

The draft 2025 Budget must first be dealt with by a committee of the lower house Chamber of Deputies before being put to lawmakers for a vote.

During his address to the Legislative Assembly, Milei said that his proposal was built on three key objectives, which he argued would change Argentina.

“Our budgetary methodology will achieve three unprecedented objectives,” said Milei.

“It will guarantee fiscal balance, putting an end to the punishment of debt and emissions. It will force the state to take charge and absorb the cost of possible recessions,” continued the President.

Thirdly, he said that “for periods of abundance, such as the coming years, it will force the government to return excess revenue to society by lowering taxes.”

“This means that, if this methodology is maintained from now on, we will not only be able to reduce taxes but also the size of the state, which is the real tax burden,” said the self-described “anarcho-capitalist” leader.