Moody's raises objections to the Treasury's financial plan: postpones fiscal adjustment and complicates debt dynamics
The agency warned that cutting spending is an unavoidable necessity. Photo: Courtesy - Moody's
TL;DR
- Moody's analysis of Colombia's financial plan introduces doubts about public finance trajectory.
- The plan proposes deficit reduction through reduced spending, but structural adjustment is delayed.
- Fiscal deficit is projected to remain high, exceeding targets set by the fiscal rule.
- Revenue projections are questioned, with some expected income depending on judicial approval of new taxes.
- Public spending rigidities and political context are expected to hinder fiscal containment measures.
- Interest payments on public debt are expected to increase again in 2026.
- Moody's acknowledges some exceptional fiscal improvements in 2025, like reduced interest payments and peso appreciation.