Sovereign Debt Sustainability in Latin America After the Pandemic

Public debt ratios across Latin America have markedly increased as a result of the pandemic. The IMF estimates that general government debt for the region as a whole increased by 9 percentage points (pp) of GDP from 2019 to 2020. Despite this, some Latin American governments can now borrow in the market at historically low rates as central banks in advanced economies and in emerging markets deliver highly expansionary monetary policy.