INSUBCONTINENT EXCLUSIVE:
climbed.Analysts highlight that mandatory future expenses, which account for approximately 95% of the federal budget, exacerbate the
19.5% to 18.7% of GDP in 2024, representing a real decrease of 0.7% after adjusting for inflation
In 2023, spending surged to 19.5% due to the repayment of these debts, which amounted to approximately R$90 billion ($15 billion).Additional
Faces Fiscal Challenges as Debt Rises Despite Spending Cuts
(Photo Internet reproduction)The apparent drop in spending for 2024 reflects adjustments based on an elevated base from the previous year
and factors like stronger economic growth and inflation embedded in GDP statistics.However, experts argue that some spending reductions were
achieved by shifting obligations into earlier periods
Debt CrisisThe fiscal deficit remains a pressing issue
Brazil recorded a nominal deficit of 8.45% of GDP, driven by rising interest costs as inflation forced the central bank to maintain high
interest rates.The gross government debt also rose from 71.7% of GDP in December 2022 to 76.1% by December 2024
obligations further complicate matters, including indexed minimum wage increases tied to GDP growth
Additionally, rising education funding through Fundeb and judicial debt payments excluded from fiscal rules add to the challenges.Analysts
Without decisive measures, maintaining fiscal stability will remain a challenge as revenue growth slows amid economic headwinds.
