Colombia proposes spending cuts to make up budget shortfall

Posted by On 12:05 PM

Colombia proposes spending cuts to make up budget shortfall

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BOGOTA, Sept 5 (Reuters) - Colombia's government will back a reduction of between 7.5 and 10 percent in "general spending" in 2019, the finance ministry said on Wednesday, in a bid to make up a $8.2 billion shortfall in funding for essential social programs in next year's budget.

The ministry did not specify what the value of the proposed reduction would be in peso terms, but said it includes cuts to goods and services acquisitions, maintenance and hiring. Those funds would be needed for education, health and other social programs, it said.

Finance Minister Alberto Carrasquilla said in a statement that the budget puts the country at the limit of its so-called fiscal rule, which establishes a deficit target of 2.4 percent of gross domestic product for 2019.

The government can, however, get congressional approval to make cutbacks in some areas to fund a shortfall. The spending reduction proposal will be included in the budget bill and debated in Congress.

Carrasquilla has said Colombia's economic situation is worrying. The Duque government is expected to shortly present a tax overhaul meant to steady the economy, but critics say plans to increase duties on individuals while reducing them on companies are unfair.

($1 = 3,092.7500 Colombian pesos)

This article appears in: Stocks , World Markets , Economy , PoliticsSource: Google News Colombia | Netizen 24 Colombia

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