Monetary Fund says Nicaragua needs fiscal buffers

Nicaragua’s fiscal stance is broadly adequate to maintain macroeconomic stability in the near term, but fiscal buffers are needed to confront risks, the International Monetary Fund concludes following its consultation with the country.

The need to finance growing state-sector deficits and to take over some critical social programs currently financed by Venezuelan cooperation are likely to intensify spending pressures in the next few years. Fund staff recommens a fiscal consolidation of 1.6 percent of GDP, implemented over two years, to maintain fiscal sustainability in the medium term.

Source: International Monetary Fund