The president of the Bank of Guatemala has stated that in order to sustain the fiscal debt, the tax burden in the Guatemalan economy will have to rise from 11% today to 14%.
An article on Lahora.com.gt reports that, Edgar Barquín president of the Bank of Guatemala, said "... in order to maintain economic stability and ensure social spending for the benefit of the population, the level of taxes needs to rise to 14 percent of GDP this year. According to the official, rating agencies consistently report that one of the weaknesses in Guatemala, in financial terms, is the low level of taxes."
In order to maintain a deficit reasonable and economically sound development in the next few years policies on borrowing are needed.
This was the recommendation of the president of the Bank of Guatemala, Edgar Barquín, in an interview with Joel Maldonado from S21.com.gt. "... The country lacks a policy on public debt. The governments of the past 25 years have been indebted to the nation according to what they need for the next year and have not had a foundation for the medium and long term," he said.
The president of the Bank of Guatemala, Edgar Barquin warned that "In a decade, the debt level will be critical."
Guatemala's foreign debt currently amounts to 25% of gross domestic product (GDP), and it appears to be far from the critical point, which is indicated by 40% of GDP.
However Barquín explains that the problem is in the low payment capacity of the Guatemalan state, which could be compromised in terms of the maintaining a fiscal deficit at a reasonable level.
The International Monetary Fund (IMF) report sheds a positive light on the country's macroeconomic situation and the stability of its financial system.
A staff team from the International Monetary Fund (IMF) visited Guatemala during August 17-26, 2010 to conduct the fourth and final review of the Stand-By Arrangement approved in April 2009. The mission met with Minister of Finance Edgar Balsells; Central Bank Governor María Antonieta de Bonilla; Superintendent of Banks Edgar Barquín; other senior government officials, and representatives of the private sector.
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