Ministry of Finance commits to cut ₡ 170 billion by 2022.

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As part of the Government’s commitment to contain public spending, the Minister of Finance, Elian Villegas, announced a cut of ₡ 170 billion in primary spending in the ordinary budget project for fiscal year 2022, without touching capital spending.

This was explained in the framework of the eleventh multisectoral dialogue table, indicating that this would have an impact of 0.47% on the Gross Domestic Product (GDP), which would allow generating financial stability, providing good signals to the international market and positioning the country as the best credit subject.

Minister Villegas was categorical in pointing out that this reduction commitment of ₡ 170 billion colones by 2022 will be below the limit set by the application of the fiscal rule, that is, it will be an additional reduction.

The commitment for the year 2022 is additional to what has already been done for 2021, since in what corresponds to next year, the Executive Power proposed a cut of ¢ 150 billion more in primary spending (0.42% of GDP) in the project regular budget.

This proposal is in addition to the reduction already contemplated in the budget project originally presented to the Legislative Assembly.

In this way, the reduction of primary spending in the 2021 budget would reach ¢ 518 billion, which is a 7.5% reduction compared to the primary spending of 2020. This, because the budget project sent to the Legislative Assembly in September it already included a cut of ¢ 368,644 million (1.02% of GDP), in relation to the budget for 2020.

Villegas’ commitment received acceptance from some sectors, among them the economist Gerardo Corrales, who recognized the effort of the Ministry of Finance to reduce public spending and also urged the Legislative Assembly to approve this action.

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