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Argentina's Milei Experiment at Year Two: Shock Therapy Verdict

Argentina's shock therapy under Milei has delivered its headline wins: annual inflation collapsed from 211% to roughly 31–50%, the first fiscal surplus in over a decade was achieved and sustained, and official poverty data show a sharp recovery from a peak of 52.9% in mid-2024 to 28.2% by end-2025 — though critics at Greenwich and King's College argue the social infrastructure dismantled in the process makes that recovery fragile and potentially statistical. The core unresolved tension is whether the short-term costs — a poverty spike, deindustrialization signals, rising unemployment, and the surrender of monetary sovereignty to an IMF-backed exchange-rate regime — represent necessary transitional pain or the foundation of a different kind of crisis. Readers should note two underreported fault lines that may prove decisive: official poverty figures lack distributional breakdown by income decile or informal employment trends, and a quiet 41% rise in South-South investment alongside a 28% fall in Western FDI — including Argentina's first RMB-denominated soy trade deal — suggests the geopolitical economy of the experiment is shifting in ways the mainstream verdict has not yet absorbed.

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