Argentine President Alberto Fernández’s center-left coalition pledged to seek cooperation with the opposition and proposed a new economic plan, hoping to reach an agreement with the International Monetary Fund, after his Peron party was hit hard in the midterm elections .

voter receive punishment The ruling Peron Party faces Rising inflation and rising poverty In the mid-term poll on Sunday, half of the House of Commons and one-third of the Senate were in elections.

The conservative opposition alliance Together for Change narrowly led six of the eight key Senate elections, causing the Peronists to lose their majority in the Senate for the first time since the country restored democracy in 1983. The election for the House of Commons in the province of Buenos Aires, which has nearly 40% of voters and Peronist strongholds.

After the results were announced, Fernandez vowed to “seek dialogue” with the opposition, which is the clearest sign of how the president plans to deal with the failure of his party so far. In a televised speech, he said that he plans to submit an economic plan to Congress in the first week of December and agree on a “sustainable” Agreement with the International Monetary Fund Re-arranged $44 billion in debt, most of which will mature next year and 2023.

“In this new phase, we will deepen our efforts to reach a sustainable agreement with the International Monetary Fund. We must clear the uncertainty caused by this unsustainable debt,” Fernandez said.

The market is optimistic about the prospects for the opposition to play a greater role in containing the power of the alliance. U.S. dollar-denominated bonds maturing in 2035 rose 0.7 cents to about 31 cents on Monday, the largest increase since the primary election on September 12.

“Peronism faces a whole new challenge: it has lost a quorum in the House of Representatives and Congress,” political adviser Sergio Berensztein told the Financial Times in Buenos Aires. Due to the poor performance in the mid-term, the divisions within the Peron party will intensify. There will be moderates allied with the president and radicals led by Vice President Christina Fernandez de Kirchner.

After voting in the primary elections in September, tensions broke out within the ruling Peronist group, when the opposition defeated the government by 9 percentage points. In response, the government appointed new cabinet members, implying that Fernandez has given up further positions to his powerful deputy.

Fernandez de Kirchner later published an open letter blaming the president’s economic policy for the “political disaster” in the primary election and demanding changes.

Fernández de Kirchner is a tall Peronist figure who served as president from 2007 to 2015, but was absent on Sunday night in particular. After early exit polls showed signs of center-left failure, she announced that she would not show up for health reasons, including in the province of Santa Cruz, the political stronghold of her family.

The government is now faced with the dilemma of working with the opposition to pass laws and make important appointments, including judicial appointments, or to further radicalize it.

Alberto Ramos, head of the Goldman Sachs Latin American Economic Department, stated that “internal disagreements on policy directions may increase” and weakened mandates increase the risk of “more populist recent policies”, such as strengthening the government Control of the economy.Economy, and insist that the IMF give way to debt repayment in negotiations Billions of dollars From its record-breaking rescue plan.

Ramos added: “The more pro-market composition of Congress may lead to more effective checks and balances, and eventually achieve a change in the policy system in 2023.” However, considering that the Argentine economy is facing high state subsidies and financing through money printing The fiscal deficit and other serious imbalances, he said, “macro and financial volatility may still remain high.”

The midterm elections are seen as an early sign of the opposition’s strength, as it is preparing for the 2023 presidential race.

The poor economic situation has also weakened the two-party system, leading to a surge in support for more extreme candidates. According to the latest official data, Argentina’s inflation rate is 52.1%. By the first half of 2021, 40.6% of people are living in poverty, compared with 35% when Fernandez took office.

Javier Milei, a 51-year-old outsider, performed well in the city of Buenos Aires. He won a seat in Congress with 17% of the vote. This is one of two congressional seats won by his Free Advance Coalition in Sunday’s election.

On Sunday, Mire chose a famous music venue to welcome his thousands of supporters because the results were announced. Milei’s liberal platform includes the abolition of the central bank, free love and the breaking of the “caste system” in Argentine politics.

“Help me change this country,” he shouted from the main stage of the Luna Park Stadium. The ally of the popular mayor of Buenos Aires, Horacio Rodríguez Larreta, won the race in the capital and the surrounding province of Buenos Aires, and he hopes This will make him a popular candidate to lead the opposition in 2023.