By: Staff Writer
May 30, 2025
The Economic Commission for Latin America and the Caribbean (ECLAC) said in a new report that public revenues declined in Latin America and the Caribbean (LAC) for 2024 compared to 2023.
The report, Fiscal Panorama of Latin America and the Caribbean, 2025: boosting investment for growth and sustainable development, also noted that the burden of interest payments on public debt weighed more heavily in the LAC.
The report also said: “Fiscal space remains limited in the region because of these trends. Although overall deficits fluctuated slightly in some countries, they remained high on average in 2024, at levels similar to those prior to the coronavirus disease (COVID-19) pandemic. Unlike the countries of Latin America, Caribbean countries continued to generate primary surpluses, with a view to reducing their public debt burden, somewhat limiting the financing available for key sustainable development expenditures.
“Although public indebtedness has fallen slightly in the years following the pandemic, the region as a whole continues to grapple with substantial debt burdens, which constrains countries’ policy space, particularly in the current macrofinancial context of high interest rates.”
The report added: “Against this regional backdrop, it is increasingly important to highlight the potential of fiscal policy to enable and accelerate the structural transformations necessary for the region’s countries to truly attain the Sustainable Development Goals (SDGs).
“Bearing in mind the three main roles of fiscal policy (generating and allocating resources, promoting equity, and ensuring economic stability and fiscal and environmental sustainability), and taking two distinct and yet complementary approaches (top-down and bottom-up), it is possible to attain a broad overview of fiscal policy and its different areas of action and influence.
“Strengthening all fiscal instruments (revenue, expenditure and financing) would enable the region’s countries to address most existing structural gaps and challenges.”
The report finally said: “The deep development crisis facing Latin America and the Caribbean is not insurmountable, but it will require concerted efforts by governments, firms and households to see through the transformations required to establish a productive, inclusive and sustainable development path.
“Observers argue that these efforts should be directed towards achieving stronger, inclusive and sustainable economic growth; reducing inequality and promoting greater social inclusion and mobility; and fostering sustainability and ramping up the fight against climate change.”