LatinNews Daily - 28 August 2026

*Colombia’s new government led by President Abelardo de la Espriella has unveiled its budget proposal for 2027. This outlines Col$635tn (US$201.3bn) in planned spending, representing an increase of Col$59.3tn on the 2026 budget. The proposal, which will now be debated by congress, aims for a fiscal deficit of 2.3% of GDP. Finance Minister Miguel Gómez Martínez said that the new administration inherited a fiscal deficit of 4.4% of GDP from the previous government led by former president Gustavo Petro (2022-2026), higher than the 2.1% deficit which had been previously declared, and announced plans to bring this year’s shortfall down to 3.3% of GDP via spending cuts which will be announced in the coming days. A statement on the website of the presidency said that the 2026 budget had failed to account for various spending needs and said that this has been addressed in the 2027 proposal, including Col$9.6tn for the fuel price stabilisation fund, Col$6.5tn for pension payments, and Col$4.5tn for public sector salaries. It also said that the 2027 draft budget includes an additional Col$37.4tn in debt interest payments “deriving from the irresponsible debt strategy of the previous government which accumulated short-term debts, whose interest rates were higher, and did not include them in its accounts”.

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