The Justicialist Party had been founded in 1945 by Juan Perón, largely on the promise of greater self-reliance, increased state ownership in the economy and a shift in national policy to benefit "the other half" of Argentine society.

Taking office on Perón's ticket in 1989 amid the worst crisis in a hundred years, President Carlos Menem had begun the systematic sell-off of Argentina's array of State enterprises, which had produced nearly half the nation's goods and services.

Following 18 months of very mixed results, in February 1991 Menem reached out to his Foreign Minister, Domingo Cavallo, whose experience as an economist included a brief but largely positive stint as the nation's Central Bank president in 1982.

Barred from immediate reelection by the 1853 Argentine Constitution, President Menem reached out to his predecessor and head of the embattled centrist Radical Civic Union (UCR), Raúl Alfonsín.

Meeting at the presidential residence in Olivos in November 1993 to negotiate an extensive amendment of the Constitution, the two leaders came to an agreement of mutual benefit: Alfonsín obtained the direct election of the mayor of (UCR-leaning) Buenos Aires (depriving the presidency of a right held since 1880 to appoint its mayor) and an expansion in the Argentine Senate from 48 to 72 members (3 per province), which would assure the runner-up (presumably the UCR) the third seat; Menem, in return, secured his right to run for reelection.

Alfonsín's candidate in the UCR primaries, Río Negro Province Governor Horacio Massaccesi, defeated Federico Storani and Rodolfo Terragno for the nomination over their opposition to the Olivos Pact.

Bordón, a popular Mendoza Province Senator was a centrist who also lent the leftist Álvarez, whose strength was in Buenos Aires, appeal in Argentina's hinterland (which had benefited least from the 1991-94 boom).

Bypassing the previous electoral college system, a victory by direct proportional voting could be achieved by either through a run-off election (in case no candidate obtained a clear majority).

The UCR had been badly tarnished by President Raúl Alfonsín's chaotic 1983-89 term, though its candidate, Río Negro Province Governor Horacio Massaccesi, had earned international renown in 1991 for storming a local National Bank branch in search of needed funds being retained by the federal government for what seemed to be political reasons.