ED – this is bne IntelliNews's annual Brazil OUTLOOK 2026 for the upcoming year, where we make a forward-looking assessment for all of the major Global Emerging Markets in Emerging Europe, Asia, Latin America, Africa and the Middle East, drawing on insightful reporting from our bureaus around the world.

What is on the agenda? What are the prospects for economic growth and what problems lie in store in the coming year? A detailed report that covers, business, economics, finance, energy, politics and the major sectors of the most important markets.

Argentina enters 2026 having achieved what many economists considered impossible. Annual inflation, which peaked at 211% when Javier Milei took office in December 2023, has fallen to 31.3%, the lowest reading since July 2018. The fiscal accounts, which ran deficits for decades, delivered a 1.4% primary surplus through October 2025. International reserves recovered to $41.9bn. And last month, Argentina returned to international debt markets for the first time since January 2018, issuing a four-year bond at 6.5%, a rate reflecting improved credibility rather than distressed pricing.

Yet beneath these achievements lies complexity. The country faces over $10bn in external debt obligations during the first half of 2026, including more than $4bn due in January alone. Manufacturing has collapsed, with 17,063 factory closures in 2024 and 236,845 jobs lost. Formal employment contracted by 276,624 jobs between November 2023 and August 2025: 432 job losses daily. Poverty, whilst declining from 53%, remains elevated at 38.1%.

The critical question for 2026 is whether Argentina's stabilisation represents genuine structural transformation or merely another temporary reprieve in the country's long boom-bust cycle.

October's midterm elections delivered Milei decisive validation. La Libertad Avanza secured 40.84% against the Peronists' 31.64%, expanding from 37 to 64 Chamber seats. However, the LLA remains short of congressional majorities, requiring coalition-building for labour flexibilisation, tax simplification and privatisation.

Argentina's relationship with the Trump administration has emerged as the most significant geopolitical development. The $20bn support package positions Argentina as Washington's preferred Latin American partner, reinforced when Trump exempted Argentina from baseline tariffs whilst denying similar treatment to Brazil. This creates tensions within the Mercosur regional bloc. Argentina's November rejection of the G20 declaration and designation as Israel's primary Latin American broker signal deliberate regional isolation in exchange for US backing.

Yet dependencies exist. Treasury Secretary Bessent pointed out that support is "policy-specific"—backsliding triggers withdrawal. Argentina defaulted three times since 2000, and whilst US support provides some breathing room for this year, underlying challenges of reserve accumulation and debt sustainability remain.

Argentina's real economy displays stark divergence. Oil production hit a record 859,500 barrels per day in October, with Vaca Muerta contributing 567,800 bpd. The RIGI framework attracted $33.6bn in project submissions. McEwen Copper's $2.7bn Los Azules project will become Argentina's first high-purity copper cathode producer when production begins in 2029. Energy exports could generate $19bn annually by 2030.

Meanwhile, manufacturing competitiveness collapsed. Whirlpool's closure of its $50mn Pilar factory exemplified the crisis: costs 25-30% above Brazil made domestic production unviable. Capacity utilisation reached only 58.3%. Companies under 500 workers accounted for 99.63% of closures. This creates fundamental tension between emerging comparative advantages in extractive industries and employment generation needs.

In December, Argentina announced currency trading bands would expand at the monthly inflation rate starting in 2026, abandoning the fixed 1% pace whilst targeting $10bn in reserve accumulation. With November inflation at 2.5%, bands could widen at more than double the existing rate. The peso weakened 3.46% to 1,490 per dollar on announcement, whilst sovereign bonds rallied.

The shift acknowledges the current managed regime proved unsustainable, requiring emergency US intervention during September-October volatility. Successfully accumulating reserves whilst avoiding inflationary pass-through represents 2026's most delicate balancing act. Real appreciation of 15-20% through 2025 eroded competitiveness, encouraging agricultural producers to delay sales and manufacturers to cite currency strength alongside labour costs in closures.

Argentina has laid foundations through painful adjustment, delivering macroeconomic stabilisation, political validation and initial market reopening. The December bond issuance represents a meaningful credibility improvement. Energy and mining offer genuine transformation opportunities in commodities where global demand will surge.

Yet execution risk remains the binding constraint. Successfully refinancing $10bn+ requires every strategy component delivering. Maintaining fiscal discipline whilst advancing reforms through coalition-building will test governing skills. Managing currency transition without triggering boom-bust cycles requires technical competence and political courage.

Whether 2026 becomes transformative or another turbulent chapter depends on navigating these challenges successfully.

Read the full OUTLOOK Argentina 2026 report here.