The proportion of Argentines living in poverty fell from 38% to 32% in the first half of this year, according to data published on Thursday by the government’s INDEC statistical institute. 

The number has fallen for two straight semesters since peaking at 53% in the first semester of 2024, when the country was reeling from a sharp devaluation and other drastic economic measures implemented after President Javier Milei took office. 

Milei has often claimed that the decline shows how his deep public sector cuts, which he famously compares to a chainsaw, have lifted 12 million people out of poverty.

However, social organizations and poverty researchers warn that the figures hide a complex reality, and while poverty has fallen, genuine improvements to living standards have been patchy.

Milei’s measures did succeed in reducing inflation, which went from 13% for the month of November 2023 (the last full month of Alberto Fernández’s presidency) to 2% in August 2025. This helps to reduce poverty because it means that money — and therefore salaries, pensions, and other forms of income — holds its value.

Affording the basic basket

The INDEC defines poverty based on whether a household can afford the basic basket of goods. Destitution (indigencia), a more extreme category of poverty, is calculated based on whether that household is earning enough to cover the basic basket for food only. Compared with the second half of 2024, total family income increased by 26%, whereas the basic food basket went up by 13% and the total basic basket by 12%.

However, the latest figures “over-represent decline in poverty,” according to the highly respected Argentine Catholic University’s Argentine Observatory on Social Debt. There are a number of reasons for this. When inflation and prices change sharply, measurement of income poverty “tends to be less accurate,” the Observatory noted.

Changes to the INDEC’s questionnaire, as well as a recent dynamic whereby households under-report their income less than they used to, mean that the true picture is being captured better — and that it’s hard to compare like-for-like with previous periods, according to both the Observatory and other sociologists.

Moreover, the goods baskets themselves are still using figures from a consumption habit survey done in 2004-5, which distorts the data. The INDEC has promised to update its basic basket figures before the end of the year to reflect a more recent survey from 2017-2018. That will also impact how inflation is calculated.

“Without ignoring the fact that improvements are evident, it should be noted that official data overstate the magnitude of social relief,” the Observatory said.

Living conditions in poor neighborhoods

Poverty is about more than the number of households above the breadline. The NGOs ACIJ and La Poderosa found that progress integrating low-income neighborhoods (known as villas in Argentina) into cities around the country has stalled after years of progress by local and national governments.

“During 2024, there was worrying regression in this area, with the defunding of key policies and the fragmentation of actions at both national and local government levels, which interrupted the transformation processes,” they wrote in a report. 

The organizations studied nine neighborhoods in six provinces to produce the report. They found that 90% of households face high environmental risk, according to an index that considers the presence of pests, accumulation of garbage, and proximity to sources of pollution. 

Only 27% of homes were on paved streets, while 46% were on dirt roads. Half of households studied didn’t have a formal water connection, and the figure was as high as 95% in some neighborhoods. Meanwhile, 63% were not properly connected to the power grid. 

“41% of families rely on community kitchens, a figure that reaches 60% in some neighborhoods,” the report said. The Milei administration defunded soup kitchens, accusing the social organizations that run them of being corrupt.

Resorting to loan sharks to buy food

The government’s macroeconomic policy has also affected the situation for consumers and small businesses, according to another report by Córdoba’s Institute of Statistics and Social and Economic Trends (IETSE), which depends on the Grocers’ Association. Stratospheric interest rates in recent months sought to control the exchange rate by making a switch to the dollar less appealing. However, that has made borrowing more expensive, limiting credit to consumers and small businesses. 

“This may explain the fact that the use of credit cards for food purchases has fallen for the second consecutive month by one percentage point,” the report said. This has forced families to resort to loans — some formal, others from sharks.

“The social indicators in this report show the seriousness of this situation,” the IETSE survey noted. It had a sample size of 2,500, and unlike the ACIJ and La Poderosa study, it examined Córdoba as a whole, not just impoverished neighborhoods. 

In Córdoba, they found that 58% of families couldn’t afford the basic food basket in August. Of those that could, 72% accessed it through state aid. Half of households said they were skipping one of their daily meals, usually dinner.

“This also compromises the nutritional health and development capacity of families in the medium term,” the report warned.