Recently, Argentina has seen frequent "unusual moves" in its diplomacy. President Milei made some unprecedented statements on international affairs during a TV interview program that aired on a certain date. Shortly after, he announced his participation in the G20 Leaders' Summit to be held in Brazil in November, expressing his hope to meet with Brazilian President Lula, whom he has repeatedly criticized vehemently.

Public opinion generally believes that the attitude of Milei towards countries such as China and Brazil has shifted from intentionally distancing itself at the beginning of his administration to actively seeking closer ties, and even harboring certain expectations. This reflects that the Argentine government led by Milei is gradually making some strategic adjustments in the face of reform stalemates. However, the sudden dismissal of Argentine Foreign Minister Montironi by Milei at the end of the month for voting in favor of lifting sanctions against Cuba at the UN General Assembly indicates that the existing diplomatic route of the Milei government has not undergone a fundamental change.

In the foreseeable future, the adjustments to the foreign strategy and measures of the Milei administration remain uncertain. However, it is certain that considering the development of Argentina, its diplomatic direction will become more complex.

On [date], in Buenos Aires, Argentina, President Milei (front) delivered a speech to the National Congress while submitting the annual budget proposal.

It is difficult to act unilaterally in a complex reality. Ideologically, Milei has long adhered to right-wing conservative values, maintaining close ties with American conservative organizations and Jewish groups, showing unwavering affinity towards the United States and Israel. Meanwhile, he holds a vehement stance against left-wing forces in Latin America, particularly towards Brazilian President Lula.

In the context of the Ukraine crisis, Milei firmly condemns Russia and expresses willingness to sell Russian-made weapons from the Argentine military to Ukraine. Regarding China, during his campaign, Milei held a negative stance on joining the Belt and Road Initiative, trade relations with China, and the currency swap agreement with China.

However, reality dealt a heavy blow to Milei's government—the full embrace and economic support promised by the West are still far off, and Milei's government is gradually realizing that its radical foreign policies will damage Argentina's most important economic and trade partner relationships. Brazil is Argentina's largest trading partner and largest import source, while China is Argentina's second-largest trading partner, largest import source, and primary source of foreign investment. Notably, the billion-dollar currency swap between China and Argentina has become a crucial source for Argentina to maintain its foreign exchange reserves and even pay its debts. Russia is the main source of essential materials like fertilizers, which are crucial for Argentina's agricultural and livestock industries.

The attitude of Milei's government towards Brazil, China, and Russia has undoubtedly filled international markets with doubts about Argentina's economic prospects. At the same time, Milei urgently needs to create a favorable "market-friendly" business environment to advance the economic reforms promised during the campaign, and an extreme diplomatic route will significantly weaken external predictions about the stability of the Argentine market. In response, Milei has begun to gradually soften his stance in the diplomatic arena.

He first signaled an adjustment by stating that "it would be a serious mistake for Argentina to sever ties with China," shortly after taking office. Subsequently, he dispatched then Foreign Minister Monzón on a visit to China, directly conveying the message of his desire to continue strengthening economic and trade cooperation with China, and hoping that China could extend the bilateral currency swap agreement due to expire in the coming months.

Milei's Economic Reforms Enter a Critical Phase. Before Milei took office, Argentina's economy was plagued by high inflation. Since assuming the presidency in the month and year, Milei has introduced a series of "shock therapy" reform measures aimed at rescuing the economy, with the goal of reducing the fiscal deficit and controlling inflation. These measures have been criticized as too radical, sparking controversy and even protests.

Since the second half of this year, this "shock therapy" reform has entered a critical phase. On one hand, Argentina's macroeconomy has shown improvements in numbers, with the country achieving fiscal surplus and trade surplus for consecutive months this year, and the national risk index has dropped to points, being regarded by the international community as a rare economic "bright spot" for Argentina in over a decade.

On the other hand, inflationary pressures remain high. From last month to this month, Argentina's cumulative inflation rate reached %, with price increases even surpassing those in Venezuela, which is under U.S. economic sanctions. Prices for essential services closely related to people's livelihood, such as gas, electricity, water, and public transportation, have increased by approximately %. Data released by Argentina's statistical agency at the end of the month showed that the country's poverty rate jumped from nearly % to .%, with the extreme poverty rate rising to .%. Nationwide, .% of households are in poverty, and the number of poor people has reached a twenty-year high.

Many Argentinians believe that the effectiveness of Milei's economic reforms is a distorted outcome of the government "tightening its belt," cutting a large amount of social spending and welfare expenditures. The trade surplus is attributed to the shrinking import demand caused by reduced incomes and diminished consumer spending power. The cost of this digital growth is a significant decline in the standard of living and excessive sacrifice of growth potential, which is not the normal "effectiveness" of reform.

Moreover, the radical reform measures of the Milei government in the political and social fields, including bypassing the National Congress in the form of "presidential decrees," reducing the number of ministries from 18 to 9, halting public construction projects, amending the Labor Law and Customs Law, forcibly initiating the privatization of state-owned enterprises, and so on, have sparked strong dissatisfaction among the opposition and the general public. The left-wing Justicialist Party and its allies, as well as various trade unions, have launched multiple large-scale demonstrations and are currently planning new street actions.

Against this backdrop, Milei's administration has arrived at a "crossroads." If it can successfully continue to advance reforms, attract more foreign investment, and increase exports, it will bring about more job opportunities, raise labor wages, thereby boosting market confidence and attracting more domestic and foreign investment. This will create a "virtuous cycle" where each economic link mutually reinforces the others, ultimately achieving the sustained prosperity Milei's reforms aspire to.

If reforms stall, economic growth fails to break through bottlenecks, and the standard of living for the populace continues to deteriorate, it could very likely lead to large-scale social conflicts and political turmoil. This, in turn, would weaken or even destroy the confidence of domestic and foreign investors, triggering a chain reaction of market collapses, causing the reforms to "fail halfway," and potentially leading to Milei's downfall in impeachment proceedings or political strife. Therefore, ensuring rapid and stable economic growth has become the top priority for Milei's government, and its foreign policy will inevitably be adjusted accordingly.

"China-Argentina relations can bring extensive benefits to both sides." The trade volume between China and Argentina reached billions of dollars by mid-year, while the trade volume between the United States and Argentina was billions of dollars during the same period. Among the trade volume between China and Argentina, soybeans, beef, and soybean meal exported by Argentina to China are its most important export advantage products.

Over the past years, the level of cooperation between China and Argentina has significantly increased in both traditional trade sectors and areas such as mining, oil and gas, and investment in hydropower plants. The Kirchner President Hydroelectric Station and the San Pedro Governor Hydroelectric Station, both of which are the largest water conservancy projects in Argentina with Chinese participation and financing, as well as the Belgrano Railway renovation project, are crucial for the modernization of Argentina's energy and transportation infrastructure. Notably, Argentina has identified lithium mining as a key focus for future industrial transformation, and China's investment, technology, and market are invaluable partners for Argentina in achieving breakthroughs in the new energy industry.

Meanwhile, the support from the United States and Western countries for Argentina has been lackluster. The few tangible supports include agreeing to Argentina's debt restructuring with the International Monetary Fund () and providing billion dollars in short-term financing to repay existing debts. However, some Argentine media believe that this is more out of concern for Argentina's "default risk" rather than a willingness to help Argentina seek development, as the Argentine side's requests for long-term large loans or extended repayment periods have been completely ignored.

In contrast, China not only agreed to extend its currency swap agreement with Argentina but also allowed Argentina to use the swap quota to repay its debt. The swap quota is an agreed mutual borrowing limit between the central banks of two or more different countries, aimed at addressing fluctuations in the foreign exchange market and financial risks. By comparing the two situations, the Milei government can surely deeply understand the significant meaning of developing relations with China for Argentina. Recently, scholars have written articles commenting that Argentina's stance towards China is changing, with its relationship with China becoming increasingly pragmatic and re-committed to developing partnerships with emerging global economies.

From the 5th to the 10th, the 7th China International Import Expo was held in Shanghai. Marcelo Elizondo, the Argentine Ambassador to China, recently told Chinese media that the Argentine government is implementing policies to enhance its export capabilities, and that Argentina and China are complementary trade partners. The current Argentine government is willing to deepen cooperation with China under the framework of the Belt and Road Initiative and welcomes more Chinese enterprises to invest in Argentina. "The current Argentine government does not seek to decouple from China; on the contrary, we believe that the relationship between Argentina and China can bring extensive benefits to both sides."