How much would the country risk increase if the PIT-CNT plebiscite is approved?

The constitutional reform of social security that promotes the PIT-CNT through the plebiscite that will be voted on in October, together with the general elections, will have serious consequences for the economic and financial stability of the Uruguayanalysts agree.

One of them is the loss of investment grade that the country achieved last year and that is one of the reasons why Uruguay attracts investments and places global bonds in international markets with competitive conditions.

There is a unanimous warning that, if the constitutional reform of social security is successful, which, among other things, establishes the end of the AFAPs and lowers the retirement age from 65 to 60, the country’s credit rating will be almost immediately degraded.

The loss of investment grade would result in an increase in the country risk of Uruguaywhich is currently the lowest in Latin AmericaThe sovereign spread would rise from the current 86 points to at least 200. “That would imply an immediate fall in Uruguayan bonds of around 10%,” said the economist. Aldo Lema in your account on X.

The Minister of Economy and Finance (MEF), Azucena Arbelechewarned yesterday about this point by ensuring that, if the plebiscite of the PIT-CNT“the country moves to another category.”

“It doesn’t make much sense to evaluate in terms of numbers what could be tax increases, or increases in contributions from workers or employers, because it is directly a change of scenery, it is a breaking of the rules of the game, which is something that does not characterize our country,” he said.

The latest report made by the Social Security Bank (BPS) Regarding the constitutional reform of social security, he projected that the modifications proposed by the initiative of the PIT-CNT would raise the fiscal deficit up to 8% since it would imply an additional annual expenditure of US$ 1,000 million for the State to match the lowest pensions to the minimum wage.