Slump gives Peronists a chance Argentina

In the elegant Buenos Aires neighbourhood of Palermo, an orderly queue forms every weekday morning alongside a row of art deco buildings. Customers, most of them elderly, are waiting for the one thing everyone wants: foreign banknotes.

Daniel Martinez, 68, brought a thick wad of crimson pesos with him. Inside the Euroamerican bureau de change, he was given an American $50 note in return.

Argentines have been converting their pesos into dollars before presidential elections tomorrow, which most polls suggest will mark a near-certain comeback for Argentina’s left after four years on the sidelines.

Argentina is in deep recession. Inflation is running at more than 55 per cent. The value of the peso has collapsed by a third against the dollar since August, when a primary vote put leftist Alberto Fernandez a seemingly unassailable 15-points ahead of the incumbent, President Mauricio Macri.

Fernandez’s running mate is former president and first lady Cristina Fernandez de Kirchner, a free-spending Peronist whose chances of a political comeback seemed unlikely a year ago. Her probable return to power as vicepresident is largely thanks to widespread voter disappointment with Macri, a dashing business tycoon who was elected in 2015 on a promise to bring about a quick turnaround in the indebted economy.

A drought last year hit soya exports badly. This was followed by a sharp rise in US interest rates, which meant the government’s dollar-denominated borrowing costs rose sharply.

Macri turned to the IMF for a bailout. A record US$56 billion ($NZ88b) loan was agreed, but in return he had to impose deep spending cuts, including an end to the huge subsidies on household bills that his left-wing predecessors had initiated.

Politically, the timing could hardly have been worse for Macri. In the weeks before the election, the costs of public services, including gas and electricity, have rocketed.

Analysts say Macri made a costly miscalculation by assuming that Kirchner, who has faced 13 corruption scandals since she left office, was too tainted to pose a serious threat.

Fernandez, a law professor who is regarded as a more moderate Peronist than Kirchner, has spent most of his political career behind the scenes. He has given few details about how he intends to solve Argentina’s economic problems if he becomes president.

AP Vanesa Rivarola and her daughter Milena wait in a Buenos Aires park to exchange a pair of Milena’s used shoes for two packets of flour. Three years ago, the 40-year-old mother of two left her job at a shoe factory to take care of her children and sick mother. She is now part of a large online community who barter clothing for food among themselves as Argentina’s economy collapses.