Eduardo Elsztain: The businessman who whispers to Argentina’s Javier Milei

Mining is one of the few sectors of the Argentine economy that grew during the first year of Javier Milei’s administration. And that is where the powerful businessman Eduardo Elsztain, owner of one of the main real estate development companies in the South American country and of hundreds of thousands of hectares of agricultural production, began to deepen his investments. Elsztain is also a man close to the far-right president: not only has he supported Milei publicly, but also hosted him in one of his hotels during the early days of his presidency and accompanied him on a spiritual journey after his election victory.

Born 65 years ago in Buenos Aires, Elsztain saw the first glimpses of his business fortune in the 1990s, when Argentina was being governed by the person Milei usually defines as the best president of democracy, the Peronist and neoliberal Carlos Menem (1989-1999). A decade earlier, the company Inversiones y Representaciones Sociedad Anónima (IRSA), founded in 1943 by Elsztain’s Polish grandfather, was just an office with a secretary. Its growth began in 1991, when Elsztain took control and restructured it until it became the heart of a business group that encompasses real estate, finance, agricultural production and now also mineral exploitation.

The firm began investing in the real estate market, first by renting offices and then by developing the country’s main shopping centers (it owns 15). Between 1997 and 1999, it focused on the hotel market and acquired the famous Llao Llao resort in Bariloche, among other establishments. Before the end of the century, it would partner with the Argentine state in the administration of the National Mortgage Bank, the financial arm of the conglomerate. Currently, IRSA claims to have some 800 employees and a market value of close to $1.2 billion.

While he was busy with real estate, Elsztain also invested in the sector that has historically brought Argentina the greatest profits: agriculture. He did so since the 1990s, when he bought the company Cresud. The firm owns some 800,000 hectares, distributed in Argentina, Brazil, Bolivia and Paraguay. Production for the last fiscal year ending in mid-2024 exceeded 700,000 tons of grains (soybeans, wheat, corn and sunflowers) and 9,000 tons of beef.

Spiritual bond

Although Elsztain has maintained open channels with the successive Argentinean governments, his relationship with Milei has been more personal. During the 2023 campaign, the then-candidate set up his base of operations at the Libertador hotel, owned by IRSA. Not only that: Milei lived there for two and a half months, even after he was elected. The entrepreneur was also one of the promoters of the president’s embrace of Judaism. Before the elections, he urged him to make a spiritual trip to New York to visit the tomb of Rabbi Menachem Mendel Schneerson, leader of the ultra-orthodox Lubavitch movement. Milei later returned to the spot on his first trip as president-elect and did so accompanied, among others, by Elsztain himself.

“President Milei is a young phenomenon who brings change. […] It is a blessing that, after 40 years of economic desert, an economist who understands economics has come along. Argentina has chosen a different path and I think it will do it a lot of good,” were some of the compliments that Elsztain dedicated to the president at the end of last year, when IRSA celebrated 30 years of trading on the New York Stock Exchange and 75 years on the Buenos Aires Stock Exchange.

The hope placed by the businessman in Milei still remains in the realm of personal conviction. The first year of the Milei administration was marked by a drastic adjustment in search of a fiscal surplus and a severe contraction of the economy. The most recent official data on activity in Argentina, published last January by the National Institute of Statistics and Census (Indec), with figures to November 2024, show that most sectors fell in the year-on-year comparison, from construction (down 14.2%) to commerce (-1.3) and industry (-2.3). The sectors where Elsztain’s investments stand out suffered somewhat less. Real estate activity grew by 0.9%. The agricultural business, affected by the fall in the price of raw materials and by the local drought, showed a 0% year-on-year variation.

In this context, IRSA’s latest balance sheet report, corresponding to the first quarter of the 2024-2025 period, recorded a loss of 109,135 million pesos (about $109 million at the official exchange rate). For Cresud, the net result for the past fiscal year (ending in mid-2024) showed a profit of 104,729 million pesos, less than half of the 279,709 million earned in the previous period; of course, between both balance sheets there was an interannual inflation of 270%.

Elsztain’s strategic decision, in this scenario, has been to reinforce its role in mining, one of the few sectors that grew during the last year in Argentina. According to the same official data from Indec, mining and quarrying had an interannual expansion of 7.1%, when in the same period overall economic activity only increased by 0.1%.

Through Austral Gold Limited, Elsztain already had a presence in gold and silver mining, both in Argentina and Chile. With a first investment last April and another in January, for a total of close to $10 million, the businessman acquired the majority shareholding of the Australian firm Challenger Gold, in charge of the Hualilán gold mine in San Juan. In the same province, the group is developing the Casposo project, another gold mine.

Elsztain’s move is supported by government measures that favor the sector, especially the tax exemptions provided by the Regime of Incentives for Large Investments (RIGI). But he also has going for him the record price reached by gold in 2024, when the price of an ounce rose by 29.49% and reached $2,787. Analysts estimate that this year it could climb to $3,000. Everything indicates that this is a promising investment in an uncertain economy like Argentina’s.

Sign up for our weekly newsletter to get more English-language news coverage from EL PAÍS USA Edition