U.S. Vice President Mike Pence and his wife Karen Pence arrive in Buenos Aires, Argentina, Monday, Aug. 14, 2017. Pence will be in Argentina until Wednesday, when he will be heading to Santiago, Chile. (AP Photo/Natacha Pisarenko)

Pence expected to praise economic reforms in Argentina

August 15, 2017 - 9:24 am

BUENOS AIRES, Argentina (AP) — Vice President Mike Pence is in Argentina, where he's expected to praise President Mauricio Macri's economic reforms days after local primary elections that were seen as a boost for Macri's pro-business agenda.

Pence is expected to meet with local officials, hold a joint press conference with Macri, and deliver a speech at the Buenos Aires stock exchange focused on economic ties between the two countries as part of a week-long visit to Latin America.

Investors have praised Macri's decision to cut government spending, reduce taxes on exports and end economic distortions that led to years of high consumer prices under his left-leaning predecessor. But job cuts and the slashing of utility subsidies have also stoked unrest in a nation with a long tradition of providing generous state jobs and benefits.

Macri and President Donald Trump enjoy a personal relationship dating back years from their days as businessmen, and both had hoped to leverage those ties to bolster U.S.-Argentina relationship after years of anti-American posturing by Macri's predecessor, Cristina Fernandez.

During a visit to the White House in April, Trump heaped praise on Macri and declared that the two countries would be "great friends, better than ever before" — despite that Macri had supported Trump rival Hillary Clinton in the U.S. presidential election.

"There's a personal relationship there and I imagine the vice president will want to build on that," said Harold Trinkunas, an expert in Latin American politics who currently works at Stanford University's Center for International Security and Cooperation.

Pence's visit comes two days after the surprising success of Macri's political coalition in key Argentine provinces in a primary election. The results strengthened the collation's position heading into October's midterm legislative vote and gave a boost to its pro-business economic reforms.

The vote was closely watched to gauge Macri's popularity and the strength of former President Fernandez, who is expected to run for a Senate seat in October. Investors fear a return of the populist Fernandez who has vowed to fight Macri's reforms.

Fernandez had been widely expected to beat Macri's candidate in Buenos Aires province, but the contest ended in a virtual tie that was seen a major win for the president.

Pence's speech is expected to stress a message he has delivered repeatedly now: That President Trump's "America first" policy does not mean "America alone." Pence is also expected to argue that secure Latin America is crucial to the security of the United States, praise Macri's economic reforms and argue that a more prosperous Latin America is good for the U.S.

During her presidency, Fernandez kept prices for things like bread, bus rides and energy low. But her free-spending policies led to soaring consumer prices, limits on exports and currency controls that created a black market for dollars.

Macri was elected promising to clean up corruption and jumpstart the economy with a pro-business government that would roll back some of Fernandez's policies and cut back government spending. But he has struggled to rein in double-digit inflation and has been criticized for firing tens of thousands of state workers.

Pence is likely to stress the benefits of the changes, said Michael Matera, a senior fellow at the Center for Strategic and International Studies, who previously served as deputy chief of mission at the U.S. embassy in Buenos Aires, among other positions.

"Certainly the reason you're going to Argentina is to show support for a process that's still somewhat tenuous, somewhat precarious," he said.

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Associated Press writers Luis Andres Henao and Almudena Calatrava contributed to this report.

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