The analysis center indicated that the budget for the second year of Bernardo Arévalo’s government was the second highest executed since 2004, only below that recorded during the pandemic. However, he warned about low quality of spending, weak investment execution and use of debt to cover operations.
The National Economic Research Center (CIEN) On April 15, 2026, he presented an analysis of the execution of the budget corresponding to 2025, the second year of President Bernardo Arévalo’s government, and concluded that technical and legal deficiencies persist in the approval of the General State Budget, in addition to challenges to improve the quality of public spending.
During the presentation, Jorge Lavarreda, associate researcher at CIEN, explained that the current budget for 2025 amounted to Q154,836.6 million, after the pre-approved expansions added Q6,310.6 million to the initial amount of Q148,526 million.
According to the analysis, among the most relevant changes are the increases in State Obligations in charge of the Treasury, which increased Q10 thousand 95.7 million, equivalent to 19.54% more than the initial budget. He also highlighted an increase of Q1,151.7 million in the Ministry of National Defense, which represents 29.48% more.
In contrast, the Ministry of Communications, Infrastructure and Housing recorded a reduction of Q2,403.1 million, that is, 24.20% less compared to the originally approved budget.
Lavarreda pointed out that, in total, when comparing the current budget with the initial one for 2025, there was a reduction in the budget of 10 institutions, an increase in six and one remained unchanged.
Capital transfers concentrate greater increase
The main increase in absolute terms corresponded to capital transfers, which grew by Q7,310.4 million.
According to the CIEN, this increase is mainly explained by the increase of Q4 thousand 282.1 million in transfers to the Departmental Councils of Urban and Rural Development (Codedes), equivalent to 127.9%, as well as by an additional Q1 thousand 658.8 million for the municipalities, an increase of 14.1%.
Expenditure executed was higher, but below the historical average
The document states that public spending in 2025, not including public debt amortizations, reached Q137 thousand 67.5 million, a figure that represents an increase of 16.7% compared to 2024.
Despite this, the execution percentage was 90.57%, a level lower than the average of the last five administrations, which between 2004 and 2023 was 93.03%.
The CIEN also warned that both operating and investment expenses recorded lower execution than the average observed in the last five governments.
In particular, investment expenses reached an execution of 78.18%, below the historical average of 86.55%.
Investment rises, but still far from the official goal
Although the analysis recognizes an increase in the share of investment expenditures compared to the first year of government, it noted that progress is still insufficient.
In 2025, investment represented 23.4% of spending, compared to the 20.1% recorded in 2024. However, the figure is still far from the goal of 28.2% for 2027, established in the Government Plan of the Semilla Movement.
CIEN questions the use of debt to cover current expenses.
One of the most critical points of the report is that in 2025 the financing of operating expenses through debt, both internal and external, increased.
Lavarreda warned that this practice contradicts the so-called “golden rule” of public finances, which states that those who pay the debt must also benefit from the loans and spending carried out by the State.
According to the researcher, resorting to debt to cover current expenses breaks with the principle of intergenerational equity.
Recommendations
- As part of its conclusions, the CIEN recommended progressively limiting the financing of operating expenses with internal and external credit.
- He also suggested opening a space for discussion with political commitment to address the structural and strategic problems that, in his opinion, are repeated in each fiscal year.
- In addition, he raised the need for President Arévalo’s administration to clearly establish and disseminate the results it hopes to achieve.