Three Ways to Fix Latin America’s Public Finances

By Benigno López

A former finance minister of Paraguay argues that feasible reforms can yield important results.

Governments in Latin America and the Caribbean are facing a perfect storm of economic and social conditions as they seek to accelerate their post-pandemic recovery. Vulnerable communities need more help in the face of rising inequality and poverty. Health, education and other services need more resources. Governments must find a way to grow equitably and sustainably amid rising inflation, weaker world demand and high debt levels. The challenge is even more pronounced in countries with a low tax-to-GDP ratio—as is the case in many countries in the region—since there is a positive...

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