Argentina’s new president isn’t slowing down. Javier Milei, who was recently elected after a tense race, took office earlier this month and has already been working to fulfill his promise to slash the size of government.

Milei has already done away with most of the government’s various ministries. Now, his administration is further seeking to reduce government expenditures and the overall size of the state by laying off an estimated 5,000 government employees. This move is intended to streamline the government’s workforce as it grapples with devastating inflation.

The move was part of a sweeping plan of cutbacks and devaluations announced by the right-wing libertarian since he took office on Dec. 10 to transform Argentina’s struggling economy.

The contracts for other government employees, who were hired prior to 2023, will be reviewed, authorities said. The 2023 cutoff is apparently meant to target the practice of outgoing presidents padding the payrolls in their final year.

With inflation expected to reach about 200 percent by the end of the year, Milei has pledged to reduce government regulations and payrolls, and allow the privatization of state-run industries as a way to boost exports and investment.

The cutbacks have already drawn protests but Milei has vowed to forge ahead.

“The goal is (to) start on the road to rebuilding our country, return freedom and autonomy to individuals and start to transform the enormous amount of regulations that have blocked, stalled and stopped economic growth,” he said.

Milei’s administration is also set to review over one million social plans to detect and address any irregularities. This action runs parallel to the planned non-renewal of 7,000 public contracts in 2024. These changes reflect a shift in the government’s approach to employment and social welfare programs, which is part of Milei’s mission to make the government less intrusive in the lives of Argentinians.

The move is part of Milei’s broader agenda to stabilize and revitalize the nation’s economy, which has been in shambles for years. This endeavor involves massive deregulation of the economy and implementing market-friendly reforms.

On Tuesday, Milei's Economy Minister announced a series of emergency economic measures. The goal is to balance Argentina's budget in 2024. The cut is the equivalent of the US reducing its $6.4 trillion budget by $1.4 trillion.

All government employees hired in the last year will be fired. Caputo said this is to end "a habitual political practice of incorporating friends and family before the end of a presidential term."

All government advertising will be suspended for a year. "There is no money for expenses which are not strictly necessary and far less to sustain with tax-payer funding media which were only created to sing the praises of the incumbent government," Caputo said.

Reducing government ministries to nine and secretariats from 106 to 54 will cut senior political posts by over 50%, and the number of political posts will be cut by 34%.

Transfers of money to provinces will stop except for the bare minimum. These transfers have previously been used to reward friends and buy political favors. Not mentioned is that the government jobs they supported will also go away along with the transfers.

All public works contracts are canceled unless the project is already underway.

Energy and transportation subsidies will be reduced. The transportation subsidies are essentially a jobs program.

Current welfare programs will continue, but an emphasis will be on paying recipients directly rather than through a web of intermediaries. Payments for child care and food will be doubled.

The Argentine peso is devalued by 54%.

Quotas and licenses for exports and imports are abolished. In the past, businesses had to get government permission for foreign trade. Caputo said, "This takes the discretionary element out of the process of approving imports, guaranteeing transparency. Whoever wants to import can now do so, full stop."

Taxes on non-agricultural exports and imports will be raised to the same level as those on agricultural products.

The immediate results of this action are obvious. Salaries and benefits for public employees constitute a substantial portion of government expenditures. By laying off this many employees, the state can reduce its wage bill, freeing up funds for other areas.

Cutting this level of staff could also make the state’s operations more streamlined and efficient. A leaner workforce could increase productivity and lessen the weight of bureaucracy. This move signals Milei’s commitment to serious reform and is paving the way for much-needed changes in the public sector and other areas of the economy.