Outsider libertarian Javier Milei won in a nail-biter presidential runoff on Sunday, after his opponent Peronist Economy Minister Sergio Massa admitted defeat.

"Obviously the results are not what we had hoped for, and I have spoken to Javier Milei to congratulate him and wish him well, because he is the president that the majority of Argentines have elected for the next four years," Massa said.

Polls closed in Argentina on Sunday evening. Milei captured 55.69% of the vote, while Massa got 44.3%. 

The two men represent starkly different futures for Latin America's third-largest economy, creaking under triple-digit inflation after decades of debt, financial mismanagement and currency volatility.

Celebrating his victory, Milei vowed to put an end to the country's economic decline.

"Today begins the reconstruction of Argentina. Today begins the end of Argentina's decline. Today ends the impoverishing model of the omnipresent state, which only benefits some while the majority suffers," the right-wing populist said.

How did other leaders react?

White House national security adviser Jake Sullivan congratulated Milei and the people of Argentina for "holding free and fair elections."

"We look forward to building on our strong bilateral relationship based on our shared commitment to human rights, democratic values, & transparency," Sullivan said on social media.

Brazil's leftist President Luiz Inacio Lula da Silva wished the newly elected government success without naming Melei.

"I wish good luck and success to the new government. Argentina is a great country and deserves all our respect. Brazil will always be available to work together with our Argentine brothers," he wrote on X, formerly Twitter.

Meanwhile, Colombia's President Gustavo Petro — also a leftist — said the results made him "sad for Latin America," lamenting that the "extreme right has won."

Who were the runoff candidates?

Massa, 51, sought to convince Argentines to trust him despite record poverty levels during his time looking after the economy.

Milei, an anti-establishment outsider, pledged economic shock therapy, from shutting the central bank to ditching the peso for the US dollar.

The 53-year-old has often been compared to former US president Donald Trump and Brazil's Jair Bolsonaro, with Massa accusing him of aping the two politicians by raising the specter of electoral fraud — for which he has provided no evidence.

The newcomer's rants against traditional parties, who have failed to halt decades of economic decline, have fired up voters tired of the status quo.

Milei used to carry a chainsaw in a blunt symbol of his planned public sector cuts and privatization. But ahead of the second round, the stunt was dropped to try to help moderate his image among centrist voters.

Massa had sought to distance himself from the deeply unpopular outgoing President Alberto Fernandez and his Vice President Cristina Kirchner, who was last year convicted of fraud. Both have vanished from the public eye.

But he still represented the Peronist coalition, a populist movement heavy on state intervention and welfare programs that has dominated Argentine politics for decades.

Pre-vote polls were too close to call

Massa confounded the polls by coming first with almost 37% in the first-round vote last month, while Milei scored about 30% of the vote.

Polls had shown the candidates in a dead heat, with Milei holding such a slight advantage that no one wanted to predict an outcome.

Both scrambled to shore up millions of votes from the three losing candidates in the first round, the most popular of whom threw her support behind Milei.

Some voters characterized the vote as a choice of the "lesser evil," amid fear of Milei's painful economic medicine or anger at Massa over the economic crisis.

Many Argentines had said they wouldn't vote at all.

Argentina set for seismic shift

Argentines are "on the edge of a nervous breakdown," said political analyst Ana Iparraguirre of GBAO Strategies, describing uncertainty about what comes next.

Argentina is in for a tough road ahead as the strictly controlled peso reels from soaring inflation, and a lack of dollars has led to shortages in fuel, medicine and even bananas in recent weeks.

With over $400 billion in public debt, central bank reserves in the red and no credit line, the next government will have few resources with which to bolster economic growth.

"The election will mark a profound rupture in the system of political representation in Argentina," said Julio Burdman, director of the consultancy Observatorio Electoral. "I think all the political forces as we have known them are going to be transformed."

mm/lo (AFP, Reuters, EFE)