By Nelson Bocanegra
BOGOTA (Reuters) -Colombia's government proposed on Monday a 523 trillion peso ($130 billion) 2025 budget to lawmakers for their consideration, the finance ministry said in a statement, as mounting fiscal challenges put pressure on President Gustavo Petro's agenda.
The government budget proposal compares to this year's 483-trillion-peso budget, which in June was slashed by 20 trillion pesos, the ministry said.
WHY IT'S IMPORTANT
Petro is about to enter the second half of his presidential term, but without the backing of a solid majority in Congress to approve his economic and social priorities.
Congress must approve the budget bill by Oct. 20 and could make significant changes to it.
Diego Guevara, Colombia's vice-minister for finance, said the government will seek some 12 trillion pesos via a new financing law set to go through Congress, in order to cover the funds required for the budget plan.
KEY QUOTES
"This is a budget that bets on economic reactivation," budget director Jairo Bautista told a press conference. "It manages to target fundamental spending objectives in key economic sectors such as health, education and infrastructure."
BY THE NUMBERS
The bill sets out operating expenses of about 327.9 trillion pesos, debt service funds of 112.6 trillion and investments of 82.4 trillion.
The finance ministry said the budget was consistent with next year's targets of economic growth of 3% and a fiscal deficit of 5.1% of gross domestic product (GDP), which the government set out in a mid-term framework last month.
CONTEXT
The ministry also plans to propose legislation to bring forward certain fiscal changes that were set to take effect as of 2026.
CARF, an autonomous fiscal committee, said earlier this month that Colombia's government may need further adjustments to its accounts to comply with fiscal rules this year and next and stabilize its debt in the face of risks to tax collection goals.
($1 = 4,063.3000 Colombian pesos)