In this interview, the Paraguayan economist and advisor to Salvadoran President Nayib Bukele summarizes the key points of his series on Paraguay’s fiscal deficit. He analyzes the causes of the imbalance, proposes sweeping reforms to pensions, public spending, and investment, and outlines a roadmap toward a “zero deficit.” He also previews his next series: the country’s energy potential.

The quest for a zero fiscal deficit does not end in 2025; it is a long-term vision. A Paraguay with zero-based budgets and primary surpluses could invest more in health, education, and technology, thereby reducing poverty and attracting foreign investment. The cost of inaction would be “too high.” Paraguayan society, from the government down to individual citizens, must write the final chapter of this saga, deciding whether the zero deficit will be a triumph or an unfulfilled dream.

In this installment of the 12-part series titled “The Origins of Paraguay’s Fiscal Imbalance: A Technical and Comparative Perspective,” we examine the dream of a zero fiscal deficit through a data-driven technical analysis, exploring how a zero fiscal deficit is not a neoliberal utopia: it is the sine qua non for Paraguay to stop living on borrowed money and set in motion a virtuous cycle of economic freedom.

In this tenth installment of the 12-part series titled “The Origins of Fiscal Imbalance in Paraguay: A Technical and Comparative Perspective,” we examine the international perspective through a data-driven technical analysis and explore how our country seeks to distinguish itself as a model of fiscal discipline on the global stage.

Paraguay’s fiscal imbalance, which reached 3.8% of GDP in 2024 according to the Ministry of Finance, reflects structurally unsustainable public spending, which grew by 7% annually between 2020 and 2024, compared with average economic growth of 3.5%. This imbalance, exacerbated by inefficiencies in the public sector and patronage pressures, threatens macroeconomic stability and increases public debt, which reached roughly 41% of GDP.