Fiscal Reforms In Nicaragua Unlikely To Drive Significant Deficit Reduction

  • Nicaragua’s fiscal deficit will remain wide in 2019, as a severe economic contraction will weigh on government revenues.
  • While the February 2019 passage of a tax and pension reform is likely to improve the country’s long-term fiscal trajectory, the impact in 2019 is likely to fall short of government projections.
  • Fitch Solutions forecast Nicaragua’s fiscal deficit will narrow slightly to 3.8% of GDP in 2019 and 3.6% in 2020, from 4.0% in 2018.

(Source: Fitch)