Colombia’s Congress approved the 2027 budget at COP 634.9 trillion (USD 206.6 billion), with the fiscal deficit projected at a record 9.4% of GDP. The government planned a tax reform package to support spending reductions and bring the deficit down to 7.2% of GDP.
Colombia’s Congress approved the government’s 2027 spending budget on 14 September 2026, setting expenditure at COP 634.9 trillion (USD 206.6 billion) as public finances faced a projected record fiscal deficit. The Senate and lower house backed the revised bill after an earlier proposal was returned for changes.
The revised budget incorporated additional funding requirements, including needs linked to the 7.4-magnitude earthquake that struck Colombia in August. The final amount was also consistent with the revised draft previously assessed by Banco de la República, which put the budget at COP 634.9 trillion.
Finance Minister Miguel Gomez told Congress, “This is not the budget we would have liked to start our term with, but it is the budget we can afford given the current state of the national economy.”
Fiscal deficit and debt
The approved budget was based on a projected fiscal deficit of 9.4% of gross domestic product (GDP) for 2027. The gap was expected to require substantial additional public borrowing. Banco de la República had previously noted that the updated Financial Plan showed a 9.4% of GDP fiscal deficit and net debt of 66.2% of GDP, compared with the lower deficit projection contained in the 2026 Medium-Term Fiscal Framework.
The government planned to introduce a tax reform package known as the “Rescue Law”. Finance Minister Gomez said the package would seek to reduce public spending in 2027 and bring the fiscal deficit down to 7.2% of GDP, matching the level projected for 2026.
Concerns over public finances
Juan Carlos Ramirez, head of the Independent Committee for Fiscal Rule Management (CARF), told Reuters in late August that Colombia’s public finance position would become more critical if the government’s proposed 2027 budget was approved.
President Abelardo De La Espriella said on 13 September that the country’s fiscal situation was critical and attributed the deterioration to the previous administration led by Gustavo Petro. He alleged that corruption and misuse of resources had contributed to the situation, without providing evidence for those claims.
The exchange rate used in the source report was USD 1 = COP 3,072.27.
The approved budget followed a revised proposal that was COP 59.3 trillion higher than the initial draft submitted in July. Banco de la República said the revised amount represented a 14.2% increase from the COP 555.8 trillion appropriation for 2026, with COP 392.6 trillion allocated to operating expenditure, COP 87.0 trillion to investment and COP 155.4 trillion to debt service.
