Mendoza’s 2025 infra budget shows effects of Milei’s chainsaw

Argentine province Mendoza listed 217 infrastructure projects in its 2025 budget bill, which outlines a total of 230bn pesos (US$235mn) in infrastructure investments in a context of lower funding from the federal government.

The 2024 budget bill allocated 84.4bn pesos for investment in public infrastructure, which amounts to US$241mn when adjusted for exchange rates.

Provincial ministers started talks with local legislators on Monday to shore up support for the bill, daily Memo reported.

The province’s infrastructure and territorial development ministry is due to receive the largest amount at 83.4bn pesos, followed by provincial highway authority DPV with 23.8bn pesos, documents show. 

The largest single initiative involves improvements to provincial route 82 with 30.1bn pesos, which is funded by provincial resources and the Inter-American Development Bank (IDB).

Other smaller projects include:

Reconstruction of provincial route 99. Circuito-El Challao stretch (3.7bn pesos)
Blanco de Encalada II sewer collector (2.77bn pesos)
Illia hospital. Stage II (3.58bn pesos)
 Modernization of Chimba irrigation system (5.94bn pesos)

FINANCING ISSUES

One of the main differences with the 2024 budget bill concerns the source of financing for infrastructure investments, following President Javier Milei’s crackdown on public spending.

For example, federal highway co-participation went from US$4.7mn this year to barely US$119,500, at October 2023 exchange rates. 

General government revenues meanwhile saw their contribution increase from US$122mn to US$168mn.

Emanuel Fugazzotto, provincial deputy for the Mendoza Green Party, told BNamericas the local administration, led by center-right governor Rodolfo Suárez, is trying to boost government revenue by adding new charges, such as toll roads and new taxation formulas. 

“[The provincial executive] says it will lower costs, but we understand that, as it is laid out, this will outrun salary growth here. Logically it will be a complex tax burden on Mendoza’s families,” he said.

As an example, the legislator said that if an electric meter is stolen, the user will have to pay for its replacement.

“There are issues that should be guaranteed by the State when it comes to providing services, and these will be moved to users through bills and taxes,” the legislator said. 

Fugazzotto admitted that this was mainly caused by the “chainsaw” applied by Milei to federal funds, as Mendoza has historically been dependent on financing from the national government.