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.