How Javier Milei’s ‘anarcho-capitalism’ is set to deepen extractivism in Argentina

Outsider, ultra-right libertarian and self-defined ‘anarcho-capitalist’ Javier Milei came to power as Argentina’s president on December 10th 2023. He promised to go after the ‘caste’ of corrupt politicians and dismantle the ‘big state’, which he claimed were the two main causes of Argentina’s economic and ‘moral’ problems.

But the economic measures announced since the beginning of his new government make evident that Milei’s reforms are not going after the political caste; they are going after the poor and the middle-class through a shock plan of austerity measures. Moreover, the 83-page long Necessity and Urgency Decree (NUD) announced on December 20th and an ‘Omnibus’ Law comprising 664 articles announced the following week, demonstrate that the new government’s plan for libertarian transformation may not only chokehold the population, but also deepen extractivism in ways that might be irreversible.

Street art in Buenos Aires reading “te regalaste,” meaning “you gave yourself away for free.” Photo credit: Paula Serafini.

Extractivism in Argentina

Extractivism is an economic and sociopolitical model of development based on the intensive and extensive extraction of nature for export. This model has been common across the Latin American region, with origins in the colonisation of the continent. Since the mid-1990s, however, we have witnessed a new era of extractivism marked by changes in legislation, economic planning, and new technologies. These changes have led to further environmental damage, the demise of other regional economies, the trampling of indigenous rights, and health crises resulting from fossil fuel extraction and the use of toxic chemicals in agriculture and open-pit mining.

Despite ideological differences and varying governmental approaches to social policy in the last two decades, extractivism has been hegemonic in 21st century Argentina. It manifests in the low royalties (3%) paid by lightly regulated mining companies, in the expansion of agribusiness, and in the introduction of fracking. Meanwhile,  its impact on ecosystems and communities is obscured or downplayed, and indigenous and other groups opposing it are persecuted and violently repressed. Changes to the provincial constitution in the province of Jujuy implemented in mid-2023, for example, curtailed the right to protest and opened the way for more violent extraction of lithium.

What can we expect to change if Javier Milei goes ahead with his proposed legislations and policies?

Legislative changes and their likely effects

In the first place, the NUD announces a series of measures affecting food provision. This includes Article 609, which states that “The National Executive Power will not be able to establish prohibitions or restrictions on exports due to economic reasons.” It also includes the elimination of laws that promote the commercialisation of regional and small-scale producers, giving more power to the few large food companies that dominate the market.

In addition, the NUD aims to abrogate Law 26.737. The law currently restricts the amount of rural land that foreign owners can hold to a maximum of 15% of the total, people or organisations from one same foreign nationality are not allowed to collectively hold more than 30% of that total 15%, and foreigners are prohibited from acquiring land in strategic areas (e.g. border zones). According to the Argentine Association of Environmental Lawyers (AAdeAA), “its derogation entails a handover of sovereignty over our soil and fertile lands to foreign corporations that have historically seen our country as a basket of resources to exploit and loot.” Moreover, this change would jeopardize indigenous land rights and sovereignty over key waterways.

The decree also provides for the abrogation of existing mining laws regarding the National System of Mining Commerce and the National Bank of Mining Information (BNIM). The Centre of Argentine Political Economy (CEPA)warns that eliminating the BNIM, which collects and systematises information on mining activity, would lead to even lower transparency and state control.

In matters of energy, among other things, the DNU opens the way to the privatization of the national energy company YPF and removes limits on exports, without modifying current subsidies to multinational energy companies. It also eliminates the framework for ensuring internal energy provision and deactivates fiscal benefits for renewable energy.

Regarding the Omnibus Law, among the many changes proposed are modifications to three main environmental protection laws: the Law of Glaciers, which limits mining activity in glacier and periglacial areas, the Law of Forests, which delimits uses and deforestation according to area, and the Law for the Management of Fire, which protects against accidental and intentional fires to avoid speculative real estate practices. The proposed changes would give free rein to mining in fragile glacier ecosystems, deforestation of protected areas, and intentional fires, benefiting mining companies, big land owners and developers.

Finally, the Omnibus Law also seeks adhesion to the UPOV 91 normative on seeds, which would benefit companies like Bayer-Monsanto, Syngenta, and big local biotechnology corporations to the detriment of small farmers. It also establishes the “Regimen for the incentive to major investments”, which provides further benefits to extractive activities.

Extractivism reloaded

The ensemble of measures proposed by Milei’s government can deepen extractivism via three main paths.

First, through further deregulation of extractive activities and land management, and the removal of protective frameworks. In addition to potentially irreversible environmental damage, such measures would have major effects on food sovereignty and energy provision. They would also take away from frontline communities the few instruments they have for protection against extractive companies and real estate speculators.

Second, through authoritarian implementation. The government’s open stance against freedom of protest adds to the existing high levels of repression experienced by communities at the frontlines of extraction, as is the case in the province of Jujuy. In addition to its content, the decree has come under criticism from different sectors of the opposition and of civil society as being unconstitutional and authoritarian, arriving just days after the government had announced a controversial ‘anti picket’ protocol curtailing the right to protest.

And third, by significantly forsaking national sovereignty for the sake of creating an influx of dollars, as key national companies such as YPF -which recently became a player in the extraction of lithium- and strategic lands are put on sale. As AAdeAA argues, “The handover of [Argentina’s] farmland, basins and frontier lands to foreign corporations and capitals is happening in a context of geopolitical dispute between China and the USA over the control of the natural resources of the whole of the Global South.” Indeed, Milei has proudly stated during a recent interview on national television that Elon Musk, the USA government, and other US corporations have expressed interest in Argentina’s lithium.

Mieli’s experiment in ‘anarchocapitalism’ takes form as a violent intensification of extractivism compounded with extreme deregulation of labour, housing, and markets, backwards changes in matters of health and police powers, and the defunding of scientific research, which is key to ensuring any form of sovereign development. It is yet to be seen how much of the proposed change he will achieve, as resistance has emerged from different sectors of society and some of his measures, such as plans for labour reform included in the NUD, have already encountered barriers. The Omnibus Law is currently being debated by the lower chamber of congress during extraordinary sessions; a general strike called for January 24th by the General Confederation of Labour (CGT) aims to put pressure on legislators to act in favour of workers. In a global context marked by a rise of far-right movements and increasing competition over key resources, the outcomes of Milei’s experiments will not only mark the future of Argentina, but will likely set important precedents for global geopolitics.

Paula Serafini is Lecturer in Creative and Cultural Industries at Queen Mary University of London