MIAMI, United States. – Cuban economist Pedro Monreal He stressed on social network X that the planned budget deficit on the Island for the year 2024, measured as a percentage of the Gross Domestic Product (GDP), is the highest in the world, at 15.4%.
“A preliminary calculation indicates that, measured as a percentage of GDP, Cuba’s planned budget deficit for 2024 is the largest in the world, at 15.4%,” the economist wrote.
This figure places Cuba in a situation of extreme macroeconomic imbalance, even if a moderate reduction in the deficit is achieved, according to Monreal.
The economist addressed the updated deficit presented in the most recent session of the Cuban Parliament, which is approximately 25 billion pesos lower than the projection reported in December 2023.
Although this reduction reduces the percentage of the deficit in relation to GDP, it is still alarming. “The deficit updated in the session of the Cuban Parliament, lower by approximately 25 billion than the projection for 2024 reported in December 2023, would have reduced the percentage that the deficit represents in GDP compared to the initial estimate (18.5%), but it is still colossal,” explained Monreal.
In the third post of his thread, the Cuban economist indicated that tax increases as a percentage of GDP have had a limited impact due to the simultaneous increase in expenditures, which keeps the fiscal gap high.
“The dynamics of budgetary income and expenditure seem to indicate the limited impact that tax increases have had as a percentage of GDP because expenditures are also increasing and the gap remains high. Greater GDP growth is needed, which does not seem feasible,” said Monreal.
In December 2023, Monreal recognized that Cuba’s projected GDP deficit in 2024 was “larger than all current deficits in the world, with the exception of Ukraine’s.”
At that time, the economist pointed out that Cuba’s deficit was more than double that of Algeria and that no other deficit reported by the International Monetary Fund (IMF) had exceeded 8% of GDP. The economist stressed that even countries in conflict situations such as RussiaNiger, Sudan and Yemen did not exceed the deficit of 6.2%.
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