Corruption Scandals Threaten Milei’s Popularity and Argentina’s Economy

Argentina’s international dollar-denominated bonds dropped Monday to their lowest level in months as corruption allegations involving figures close to President Javier Milei emerged from leaked audio recordings, Reuters reported. The country’s currency and stock market also lost value. 

Last week, local media released audio recordings in which a voice resembling that of Diego Spagnuolo, then-head of the National Disability Agency (Andis), can be heard discussing bribery within the agency and suggesting that Karina Milei, the president’s sister and chief of staff, was receiving illicit payments. 

In the recordings, some from 2024 and others from early this year, Spagnuolo accuses Human Capital Minister Sandra Pettovello of “playing a dirty trick” by leaving him exposed to Karina Milei and Eduardo “Lule” Menem, an Argentine politician, while pretending to be unaware of the situation, MercoPress wrote.  

Spagnuolo also claimed that former Foreign Minister Diana Mondino is “in big trouble.” 

A nationwide survey by Poliarquía Consultores found that confidence in Milei’s administration reached its lowest point since he took office in 2023. The Government Confidence Index (ICG) this August fell by 13.6 percent to 2.12 points.  

The drop is attributed to the Andis scandal, which is seen as especially delicate as it revolves around the idea that Milei “doesn’t care for the weak and the poor,” according to Marcelo Garcia, director for the Americas at New York-based risk consultancy Horizon Engage. 

Garcia warned that a drop in Milei’s popularity could hinder his plans to boost financial markets, as investors are losing confidence in the country’s economy, as stocks, bonds, and the country’s currency are all falling. 

Several properties, including Spagnuolo’s residence, were raided Friday as part of a government investigation. 

Government authorities, however, have not verified the audio recording’s authenticity, and cabinet chief Guillermo Francos said that, according to Milei, Spagnuolo never mentioned any alleged bribery. 

Milei did not address the allegations directly during a Monday speech. However, he said he was not worried about what he described as attacks from the opposition ahead of the midterm elections in October. Milei’s party, La Libertad Avanza, is seeking to expand its influence in the opposition-controlled Congress in the upcoming vote. 

Some government officials described the recordings as a “political operation” by the opposition. The audio was “staged and edited,” they insisted, but even if it were genuine, it would be invalid as evidence because it was obtained illegally. 

Meanwhile, opposition lawmakers demanded that the Health Ministry, which oversees Andis, answers questions in Congress on the situation.