Chile’s Finance Ministry reset its fiscal path on Tuesday, abandoning a pledge to balance the structural budget by 2030 and aiming instead for a 1.5% of GDP structural deficit by the end of the administration in four years.
The shift reflects mounting pressure on public finances as the government struggles to rebuild fiscal buffers during an economic downturn and amid rising debt.
The new target was set out in the government’s fiscal policy decree and applies to the structural balance measure, which adjusts for cyclical swings such as copper prices and broader economic fluctuations.
The retreat from a key budget goal signals a looser medium-term fiscal stance for one of Latin America’s traditionally more disciplined sovereigns.