Pandemic Stimulus Ending in Paraguay as the Economy Bounces Back

Paraguay will continue to dial back pandemic stimulus next year as a fast growing economy cushions austerity measures that have proved unpopular in other South American countries, Bloomberg News reported. The government has already reduced temporary pandemic cash transfers to people working in the country’s vast informal sector without triggering social unrest, Finance Minister Oscar Llamosas said in an interview. “The task of adjusting fiscal accounts was largely done this year, and the idea is to continue that in next year’s budget,” Llamosas said. “The state will have to continue helping people and businesses that are most in need.” Weaning voters off pandemic era stimulus is proving a challenge in the region with Brazil signaling it might breach its spending cap next year and Argentina continuing to print money even at the cost of double-digit inflation. Llamosas’ goal of narrowing the deficit could face political headwinds ahead of presidential primaries and general elections during the next two years. Read more.