Colombia Congress Passes 2027 Budget With Record Deficit

Colombia's Congress on Monday approved the government's 2027 spending budget of 634.9 trillion pesos ($206.6 billion), as the country's public finances face mounting strain.

The Senate and lower house backed the bill after lawmakers returned an initial proposal, enabling the recently inaugurated administration of right-wing President Abelardo De La Espriella to add funding needs, including costs linked to the 7.4-magnitude earthquake that struck in August.

"This is not the budget we would have liked to start our term with, but it is the budget we can afford given the current state of the national economy," Finance Minister Miguel Gomez told Congress.

The budget projects a record fiscal deficit of 9.4% of gross domestic product, which will have to be financed largely through increased public debt.

De La Espriella's government plans to submit a tax reform package known as the "Rescue Law," aimed at cutting public spending next year to bring the deficit down to 7.2% of GDP, the same level projected for 2026, according to Gomez.

Juan Carlos Ramirez, head of the Independent Committee for Fiscal Rule Management, told a wire service in late August that Colombia would face a more critical public finance situation if the proposed 2027 budget were approved.

In a speech on Sunday, President De La Espriella described the fiscal situation as critical and blamed the government of his predecessor, leftist Gustavo Petro, for the deterioration, citing corruption and the misuse of resources, though he did not provide evidence for his claims.