The Executive Power promulgated Law No. 6672/2020 of the General Budget of the Nation (PGN) for fiscal year 2021, sanctioned by the National Congress, which amounts to a total of G. 92.2 billion (around USD 13,010 million) . This amount implies an increase of 6.9% with respect to the total resources assigned in the approved Budget for fiscal year 2020.
According to the Ministry of Finance, it is distributed in 56.3% for the Central Administration and 43.7% for the Decentralized Entities. These are financed 32% with resources from the Public Treasury (Taxes and Others), 19% with Public Credit Resources and 49% with Institutional Resources.
The total of Bonds authorized to issue for fiscal year 2021 amounts to G. 4.2 trillion (approximately USD 600 million), the main purpose of which is to finance infrastructure works and the administration of public debt.
The sanctioned Budget has a variation of G. 6.5 trillion with respect to that sent by the Executive, which is mainly due to the programming of new loans for the Ministry of Public Works and Communications (MOPC) for G. 4.3 trillion and the programming of the balances of the Emergency Law within the Ministry of Public Health and Social Welfare (MSPyBS) for G. 1.6 billion. It is worth mentioning that this programming includes the authorization to expand the fiscal deficit from 1.5% to a maximum of 4% of GDP, taking into account the effects of the Health Emergency and the need to continue maintaining an active fiscal policy to sustain the rebound in the economy.
In general terms, the approved PGN contains the basic guidelines that were included in the Project submitted by the Executive Power and, in that sense, it is considered that it will be administrable. However, through the Regulatory Decree, the Financial Plan and the other administrative tools, it will be sought to mitigate the impact that some non-priority aspects may have, which were incorporated in the approval process in Congress, such as salary increases, contracts and others. current expenses.
It is noteworthy that the PGN 2021 maintains the measures aimed at the Rationalization of Public Expenditures, including everything related to the limitations for the consumption of fuels, limits for contracting medical insurance, catering service, floral services, card stores, among others , as well as restrictions for the payment of bonuses and special bonuses for officials.
Finally, it should be emphasized that the approved PGN supports the vision of continuing the path of economic recovery and, at the same time, managing the health emergency that will continue to affect it, which requires appropriate and effective financial measures to deal with health policies that the circumstances demand.