Milei’s Policies Devastate Argentina’s Industry: The Country Ranks Second Worst Worldwide

Original article: Milei hunde la industria: Argentina queda como la segunda peor del mundo

A recent report from the Audemus consulting firm, which analyzes the manufacturing sector’s performance across 56 economies from 2023 to 2025, has placed Argentina as the second worst-performing country in the world for industrial output.

The South American nation only ranks below Hungary in this unfavorable list, characterized by a significant contraction in economic activity and massive business closures, largely attributed to the first two years of President Javier Milei’s «libertarian» administration. His policies of trade liberalization and currency appreciation are identified as primary factors behind this collapse.

Audemus’ findings, linked to former Minister of Productive Development Matías Kulfas, present unequivocal statistics. The study indicates that Argentina’s industrial production has experienced an average decline of 7.9% from 2023 to 2025.

This downturn is the second steepest in the global ranking, only surpassed by Hungary’s 8.2% decline. Following Argentina on the list are Bulgaria (-6.7%), Germany (-6.3%), Canada (-5.2%), Italy (-4.8%), and the Netherlands (-3%).

The contrast with the world’s most dynamic economies is stark, underscoring the severity of the local collapse. While Argentina, under Milei’s neoliberal policies, falters, nations like Taiwan lead the rankings with explosive growth of 32.3%, followed closely by Vietnam (23.8%) and Egypt (19.5%).

In Latin America, the disparity is also evident: Costa Rica shows a growth of 16.3%, while large economies such as China (13.3%) and Russia (13%) demonstrate industrial vigor that sharply contrasts with Argentina’s stagnation and decline. Singapore, with a 12.8% increase, completes the picture of favorable economic results.

The Causes of the Downfall: Analyzing Milei’s Policies

The Audemus report goes beyond merely outlining the symptoms, delving into the causes and clearly distinguishing Argentina’s situation from that of other countries.

While Europe’s industrial challenges are attributed to external factors such as «energy shocks, Chinese competition in the automotive sector, and trade tensions with the United States,» as reported by El Destape, the diagnosis for Argentina is fundamentally different.

Argentina’s performance also falls far behind other Latin American nations; during the same period, Brazil managed to grow its industry by 3.5%, Chile by 5.2%, Peru by 6.5%, and Uruguay by 3.7%.

Although Colombia and Mexico also recorded declines, the figures are much more moderate at -0.7% and -0.4%, respectively.

The consulting firm attributes the local crisis primarily to domestic economic policy decisions made by Milei’s government. Key factors cited include «an appreciated exchange rate that diminishes competitiveness, a rapid and indiscriminate trade liberalization, and a lack of active industrial policies,» according to the cited media.

This loss of competitiveness, amidst an influx of imports without protective strategies for national production, is having a devastating impact on the productive framework. The data on business closures is alarming; in the first two years of Milei’s «libertarian» administration, a total of 2,436 industrial companies ceased contributing to the ART system, an indicator that, according to experts, «is commonly interpreted as a closure or drastic reduction of activity.»

This figure represents nearly 5% of the total number of industrial firms in the country, indicating a sustained decline approaching the minimum levels seen during the pandemic crisis.

Semi-Empty Factories and Workers on the Streets

Companies still enduring the onslaught of the far-right government are operating with unprecedented idle capacity in the last decade. The report reveals that «the utilization of installed capacity stands at 57.9%, the lowest recorded in the last decade excluding the pandemic period.»

In concrete terms, this means that Argentina’s industrial plants are functioning at less than 6 out of 10 units of their productive potential, a situation reflecting weak demand and difficulties in placing production in a market saturated with imported goods.

This contraction in activity directly correlates with employment. According to the Audemus study, «since 2023, 72,955 industrial jobs have been lost,» representing a contraction of 6% in manufacturing sector employment.

The dynamics of these layoffs have not been uniform; following a significant drop observed in the first half of 2024, a slight recovery raised expectations of a positive turn. However, that improvement did not solidify, and since the third quarter of 2025, job losses have resumed, deepening the social crisis accompanying the industrial collapse.

Milei’s Response: Minimization of Layoffs and the End of «Industrial Fetishism»

In light of this scenario, statements from key officials in the national government of Argentina have sparked significant controversy. Economy Minister Luis Caputo downplayed the impact of the decline in industrial employment, making remarks that have drawn harsh criticism from sector unions. Caputo maintained that «in all countries of the world, people are laid off, and it is not a drama,» arguing that in dynamic economies, workers can quickly find new opportunities.

Furthermore, he proposed a shift in the economic debate: according to his definition, the discussion should not center on the opposition between an industrialist model and one open to trade, but rather between a scheme he termed «patronage» and one based on competition and investment, as reported by El Destape.

In a similar vein, President Javier Milei has been explicit in his diagnosis and roadmap. During the opening of ordinary sessions of Congress, the president harshly criticized the industrialist approach applied over decades in the country.

In a speech marked by insults and accusations directed at the opposition, the libertarian leader stated that Argentina has been «trapped in the industrialist fetish trap,» which he directly blamed for the dependency on subsidies and constraints on growth.

These remarks, set against the backdrop of statistics showing the closure of 2,436 companies and the loss of more than 72,000 jobs, solidify the impression that for the government, the social and productive costs of its adjustments are an inevitable part of the economic transformation it seeks to implement, leaving Argentina at the forefront of nations rapidly dismantling their industrial fabric.