30 TheEconomistNovember 2nd 2019
1“W
e will devoteall our efforts to
ending the suffering of all Argen-
tines,” declared Alberto Fernández, Argen-
tina’s president-elect, before a crowd in
Chacarita, a working-class area of Buenos
Aires. Mr Fernández was celebrating his
victory over the incumbent, Mauricio Ma-
cri, in a presidential election on October
27th. But Mr Macri raised similar hopes
after his election four years ago, which
ended 14 years of rule by the Peronist move-
ment to which Mr Fernández belongs.
The victory by the Peronists—who se-
cured 48% of the vote against Mr Macri’s
40% with most of the votes counted—was
narrower than expected but large enough
to avoid a run-off vote in December. The
question is whether they can do a better job
of resolving the country’s chronic eco-
nomic troubles than Mr Macri did.
The election offered voters a choice be-
tween two failed models. Mr Macri’s sup-
posedly business-friendly presidency is
ending with a shrinking economy, a falling
currency and rising prices. But the years of
populist rule by the Peronists that preced-ed it were at least as bad. The author of the
previous Peronist disaster, Cristina Fer-
nández de Kirchner (no relation to Mr Fer-
nández), will now be vice-president. When
it became clear after a primary vote in Au-
gust that the Fernández duo would win, the
peso plunged by 25% and inflation surge-
d. Even as the winners were chalking up
the votes on October 27th, shopkeepers
were marking up prices, anticipating fur-
ther devaluation and higher inflation.
Nerves have since settled. The peso
strengthened a bit against the dollar in the
black market in the days following the elec-
tion. Mr Macri, conceding defeat, invited
the president-elect immediately to the
Casa Rosada, the presidential palace. The
hope is that the two can agree a “transition
package” to keep the markets steady until
Mr Fernández takes office in December.They have already signed off on tighter cur-
rency controls, limiting dollar purchases
to just $200 a month, to prevent a possible
run on the peso. That is much lower than
the $10,000 limit imposed in September.
The election did not resolve the ques-
tion of which Fernández would truly suc-
ceed Mr Macri: Alberto, the president-
elect, or Cristina, the charismatic former
president who elevated Alberto from back-
stage operative to presidential frontman.
The early signs are mixed. In the closing
days of the campaign, Mr Fernández insist-
ed he and his running-mate were insepara-
ble. “But that was the candidate speaking,”
said one of his inner circle, as the presi-
dent-elect celebrated his victory. “He
knows he has to cut the cord if he is to sta-
bilise this economy, and win time for re-
covery from this economic mess.” Mr Fer-
nández has already signalled that he will
seek a pact with businesses and unions to
contain inflation. Entrepreneurs sound re-
ceptive. “Count on me, especially when it
comes to a social pact,” said one of Argenti-
na’s biggest soya farmers, Gustavo Grobo-
copatel, who had backed Mr Macri.
One clue to Mr Fernández’s intentions
will be his choice of treasury minister. The
two leading candidates, Matías Kulfas and
Guillermo Nielsen, are veterans of the
Kirchners’ rule (and members of Mr Fer-
nández’s transition team). But their reputa-
tions differ. Mr Nielsen has encouraged
bondholders and the imfto show patience
with the new government. He cites the ex-ArgentinaRolling back the years
BUENOS AIRES
Alberto Fernández, the newly elected president, will struggle to clean up the mess
his Peronist movement madeThe Americas
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