Business crisis in Argentina: More than 30,000 companies have closed since the beginning of Javier Milei’s administration
The economic landscape in Argentina is going through a critical moment. Since Javier Milei’s arrival to the presidency at the end of 2023, the country’s productive fabric has suffered a significant setback, with the closure of more than 30,000 companies. This figure represents a 6% drop in the total number of productive units, marking an unprecedented negative record in the first months of a national administration.
Since Milei took office, 30,633 companies have been lost, 6% of the total. It is the worst decline in the first 30 months of any government.
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According to data collected up to last May, the rate of business closures reached alarming levels, totaling 2,371 closures in that month alone, which is equivalent to an average of 76 fewer companies each day. Currently, Argentina has 481,724 active companies, the lowest figure in nearly two decades, placing it even below the records obtained during the period of pandemic restrictions.
Determining factors and most affected sectors
Specialists in the small and medium-sized enterprise (SME) sector point out that the policy of indiscriminate economic opening and the fall in purchasing power are the main drivers of this crisis. The Center for Political Economy of Argentina (CEPA) has detailed the sectoral impact of this trend:
- Trade: 8,408 fewer productive units.
- Transportation and storage: 6,733 closed businesses.
- Real estate services: 4,098 closures.
- Manufacturing industry: 4,020 fewer units.
Economist Hernán Bergstein explains that the combination of low-cost imports, which create unfair competition, along with domestic demand weakened by inflation, has broken the payment chain. This phenomenon causes a domino effect where companies with lower revenues stop buying from their suppliers, forcing the latter to cease their operations as well.
Impact on the labor market and preventive insolvency proceedings
The destruction of the business fabric has had a direct effect on formal employment. According to the figures analyzed, 411,613 jobs have been lost since the beginning of the current term, with the manufacturing industry as the most affected sector, accumulating nearly 97,312 layoffs through May.
In parallel, the increase in bankruptcy filings reflects the desperation of business owners to avoid definitive liquidation. The entity Industriales Pymes Argentinos (IPA) reported that legal proceedings initiated by companies in default increased by 131.7% compared to 2023. Daniel Rosato, president of IPA, warned that the degradation of the local economy is exceeding initial projections, resulting in structural damage to the country’s productive framework.
