TBH:
The brutal devaluation in 2002 led to several years of sustained economic growth, with annual rates around 10%.
The favourable global environment, with high commodity prices at the time, also did its part. However, at the time, the country's international currency reserves were still positive, whilst now they are negative.
IMO, there's no other way than letting the currency fall until it reaches its bottom. It actually surprises me that
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Milei, as a liberal, chose the way of a gradual devaluation instead of going directly into a free market foreign exchange regime.
Maintaining a currency's value above the market value has never worked in history. I don't know a single example. This means, Argentineans will suffer from at least 15 years of hidden inflation, which will hit them in a span of a year or two.
The social cost will be tremendous. This is definitely the reason for not
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liberating the foreign exchange market in one go.
Had the country access to financial markets, the social cost could be alleviated with debt, but this is simply not the case.
I expect people to massively default on their basic services bills, like electricity, gas and water, because they will simply not be able to pay them. I even expect hunger riots and plundering of grocery stores in the months to come.
The obvious solution would be taxing
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the rich (which exist), but I doubt there is the political will to do so, and I doubt, there's even the institutional infrastructure for such a measure.
I can only see blood, sweat and tears, until it eventually gets better in a couple of years, if there still is a country to speak of, then.
4/4