Government privatizes management of 3,900 km of national routes

The Argentine government privatized the administration of eight major sections of national routes 3,900 kilometers of roads spanning 11 provinces on Monday.  The eight companies awarded the contracts will be in charge of operating and maintaining the routes for 20 years. The move comes as the state budget for operating and maintaining national routes has dropped by almost 80% since President Javier Milei took office in 2023, according to a report from the Civil Association for Equality and Justice (ACIJ, by its Spanish initials). The budget allocated this year to national routes AR$563 billion or US$371 million at the official exchange rate is the lowest in more than three decades, ACIJ told outlet La Nacin. The report also highlighted that six out of every 10 kilometers of those roads are in poor or fair condition. The privatization of the routes was formalized in a resolution issued by the Economy Ministry and published in the Official Gazette on Monday. The resolution states that the eight companies will be in charge of building, managing, expanding, maintaining and repairing those sections of national routes allocated to them and can also seek additional income by collecting tolls. This is the third stage of a larger plan launched in 2025 aimed at privatizing the administration of a total of 9,000 kilometers of strategic national routes, “which carry approximately 80 percent of the country’s traffic,” the National Highway Administration said. State supervision The National Highway Administration will be in charge of supervising compliance with the contracts signed by the private companies, with the goal of “ensuring that corridors are safe and provide adequate levels of service for users.” Those privatized routes will now be managed without any subsidies from the national government, “leaving behind wasteful schemes and moving toward a more efficient system aimed at improving the quality of the National Highway Network,” the office said in a statement. Along the same lines, the Economy Ministry said that having “100% of private investment” will allow for “safer and more efficient roads.” Chainsaw Since becoming president, Milei has practically paralyzed public works, even stopping some projects that were close to completion, as part of his effort to eliminate the fiscal deficit. According to the Center of Argentine Political Economy (CEPA, in Spanish), investment in public works was 84% lower in July than in the same month of 2023. The cut in the public works budget reflects President Milei’s “chainsaw” mentality of reducing public spending to the absolute minimum.  His government has only recently begun announcing tenders for the private sector to take charge of public services such as road operations. Two weeks ago, the national government also announced a plan to expand the electric network in the Metropolitan Buenos Aires Area the most populated in Argentina via an initial private investment of US$800 million. The tender, which has not yet been formally launched, would be the first of 16 private works aimed at adding 5,600 kilometers of electric cable to the national network.