Business · Economy · 10 hrs ago
IIF proposes Brazilian debt target of 75% of GDP
The IIF proposed a new fiscal framework for Brazil's next government to control public debt.
The group says Brazil has time to act before rising debt costs create financing risks.
Its plan would bring debt down to 75% of GDP after it peaks at 90% in 2029 or 2030, then falls over five years.
Brazil's gross debt was 82.9% of GDP in August 2026, up from 71.7% in December 2022.
The proposal would limit real spending growth to 1% a year and gradually raise the primary budget balance to a surplus of 2% to 2.5% of GDP.
It also calls for changes to mandatory spending, tax benefits and social programs to support the debt reduction.
The IIF says a credible adjustment could help create conditions for lower interest rates, while measures could be approved in advance and introduced gradually.
The Institute of International Finance proposed a new fiscal regime for Brazil, aiming to reduce gross public debt to 75% of GDP.
The proposal sets a medium-term debt ceiling of 90% of GDP, with debt projected to peak in 2029-2030 before falling over the following five years.
Brazil’s gross debt stood at 82.9% of GDP in August 2026, up from 71.7% in December 2022.
The IIF recommends improving the primary balance by 0.5 percentage points of GDP a year until the surplus reaches 2% to 2.5% of GDP.
It also proposes limiting real growth in primary spending to 1% a year under a broad four-year spending cap.
- Who
- The Institute of International Finance (IIF), a global association of financial institutions.
- What
- It proposed a new fiscal regime for Brazil, including a long-term debt target of 75% of GDP.
- When
- The proposal was reported on October 24, 2026.
- Where
- Brazil.
- Why
- The IIF said Brazil has an opportunity to reorganise public finances before rising debt creates real financing risks.
This story does not have two clearly opposing sides.
Brazil’s gross debt was 71.7% of GDP.
The IIF projects that gross debt would peak at 90% of GDP.
The proposal envisages debt declining to 75% of GDP.
Brazil’s gross debt reached 82.9% of GDP, according to Central Bank data.
CNN Brasil reported on the IIF’s proposed fiscal regime.
- Debt target
- 75% of GDP
- Proposed debt ceiling
- 90% of GDP
- Projected debt peak
- 2029-2030
- Primary balance improvement
- 0.5 percentage points of GDP per year
- Target primary surplus
- 2% to 2.5% of GDP
- Proposed real spending growth limit
- 1% a year
What people are saying
This pace of fiscal consolidation should put debt on a firmly declining path when combined with structural reforms.
The adjustment should anticipate credibility, not recession.
The scope needs to be broad enough to prevent fiscal choices from being shifted outside the rule.
The annual effort should not be revised downward when its implementation becomes politically difficult.