How come the fiscal balance improved in 2025?

COLOMBIA - In Brief 01 Mar 2026 by Andrés Escobar Arango

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The Finance Ministry published fiscal data for Q4-2025 and for 2025 as a whole. The results could not be more discouraging. Even though the deficit went down from 6.7% of GDP in 2024 to 6.4% in 2025, a cursory look at the details behind this result (shown in Table 1) left us with nothing positive to say. Revenues fell from 16.4% of GDP in 2024 to 16.3% in 2025. Tax revenues improved by 0.4 pp of GDP, but the rest of the revenues fell by 0.5 pp, mainly driven by less transfers from Ecopetrol. Table 1. National Central Government: main fiscal results for 2024 and 2025 (% of GDP) Source: Finance Ministry, EConcept On the spending side, the key result is a noticeable deterioration on the primary front. Current expenditure went from 16.8% of GDP in 2024 to 17.2% of GDP in 2025, while investment jumped from 2% to 2.7%. For reasons we don’t have to elaborate on, related to the numerous debt management operations carried out by Director of Public Credit Cuéllar, interest payments were a “one-off” positive surprise (from 4.3% in 2024 to 2.8% in 2025). The end result of these opposing trends (primary v. interest) is that total spending actually fell from 23.1% to 22.7%. The main concern stemming from these results is that the increase in primary spending tends to be stickier, especially on the current expenditure front, while the abnormal drop in interest payments is only temporary. The fiscal outlook is all but promising for whoever is elected in June to replace president Petro. A closer look at spending (Table 2) sheds some light on how difficult the next years will look like. On the current expenditures side, one has to acknowledge the fact that the increase in transfers to t...