"Latin America Faces New Fiscal Hurdles"

Latin American countries are grappling with renewed fiscal challenges exacerbated by the COVID-19 pandemic, which led to increased borrowing and higher debt burdens. Despite efforts to reduce deficits in 2021-2022, fiscal imbalances widened again in 2023, driven by slow revenue growth and higher borrowing costs. Structural reforms in government spending and revenue generation are essential for long-term fiscal sustainability, with significant challenges remaining in major economies like Brazil, Argentina, and Mexico.