The 2020 Budget: Key questions linger
On July 30, Minister Carrasquilla went through the usual ritual of submitting next year’s budget to Congress and discussing the main features of the bill with the press. The latter is meant to clarify important aspects of an initiative that, while central to fiscal policy, is full of fine print that only a few people in the Ministry are really privy to. Unfortunately, the press conference left some key areas in the dark, which will hopefully become clearer during the discussion. What follows in this special report are, thus, our first impressions and our initial analysis. It goes without saying that we will have to get back to you as more information comes in.
First of all, key fiscal targets set forth in the Medium-Term Fiscal Framework remain in place, namely a structural deficit for 2020 equivalent to 1.5% of GDP, which in turn implies a target for the observed deficit for next year of 2.2% of GDP. Taking into account the fact that the external committee of the fiscal rule set the ceiling for the 2020 observed deficit at 2.4% of GDP, the strategy of the government is still to over-comply… and they claim this budget is the means to achieve that goal next year.
Now read on...
Register to sample a report