Argentine elections: Industrial strike and trade challenges ahead

Alberto Fernández of the Peronist Justicialist Party has been declared President-elect of Argentina, and is now tasked with renegotiating the largest IMF loan in history, finalizing the Mercosur-EU trade agreement, and easing the civil unrest that has choked Argentina’s supply chains.

Argentina’s Peronists swept back into power on October 27, 2019, as Alberto Fernandez and his running mate, former president Cristina Fernandez de Kirchner, defeated incumbent president Mauricio Macri.

The Peronist victory marks a shift away from austerity measures implemented by Macri which failed to reduce unemployment and stabilize inflation rates. Over the past four years, Argentina has experienced significant economic challenges that the Macri administration sought to address in part by taking on a USD 56.3 billion (EUR 51.05 billion) loan from the International Monetary Fund (IMF) in 2018 and implementing strict austerity measures.

Economic distress paired with the IMF deal and accompanying austerity measures sparked several protests and demonstrations, particularly in the cargo transportation sector. 20 cargo transportation strikes, 50 port strikes, and 63 aviation worker strikes have been recorded since Macri’s election in 2015 and have had a considerable impact on the country’s flow of goods and supply chains.

Fernandez’s running mate, former president Cristina Fernandez de Kirchner’s administration was characterized by isolationist policies, leading many to question the country’s trade outlook. The duo are now responsible for negotiating the terms of the IMF bailout, maintaining the Mercosur-EU trade deal, and mending the fractured relationship between Argentina and its main trading partner, Brazil.

This report outlines the impact previous strikes have had on supply chains as well as Argentina’s trade policy outlook under the new Peronist administration.