I don’t normally follow South American news all that closely, as despite being in the same hemisphere, little that happens there has much importance to us here in Canada or the United States. The election of Argentinian President Javier Milei, however, has made Argentina a much more interesting place to watch as Milei valiantly attempts to turn the economy around from its near-century-long decline. Here, Dan Mitchell provides his assessment of Milei’s efforts so far:
… let’s focus today on Milei’s goal of maximizing economic liberty.
The bad news is that if he wants Argentina to become the new Hong Kong, Milei has a long journey. According to Economic Freedom of the World, Argentina ranked a lowly #159 out of 165 nations in 2022.
As you can see from the EFW rankings, Milei’s country gets especially bad scores for Sound Money, Trade and Regulation (dead last for Sound Money and in the bottom-10 percent of the world for the other two categories!).
The good news is that you don’t have to be libertarian Nirvana (or even Liberland) to make a big jump in the rankings.
You don’t even need to be Hong Kong (which used to be very good with scores above 9 but has now declined to 8.58 thanks to Beijing’s intervention).
Heck, almost every country in the western world has experienced a significant decline in economic liberty this century.
Milei actually could put Argentina in first place today merely by achieving the same level of economic liberty (8.67) that the United States had in 2004.
For what it’s worth, I think it would take several years of good reforms to climb that high.
That being said, dramatic improvements are nonetheless possible in a very short period. Here’s my back-of-the-envelope estimate of where Argentina could be by the end of next year.
