President Bukele Plans Debt-Free Budget With Bitcoin Leadership

• President Nayib Bukele has unveiled a major economic initiative for his upcoming second term in El Salvador.
• This initiative is characterised by a groundbreaking approach: a fully self-financed budget without debt issuance for the coming budget year.
• “We will present, for the first time in decades, a budget that does not require new debt issuance for current expenditure,” Bukele announced.

El Salvador has announced its first fully funded national budget without issuing new debt, marking another financial milestone under President Nayib Bukele.

President Bukele outlines self-financed budget plan

In a historic move, President Nayib Bukele announced that El Salvador’s budget for the next fiscal year will be entirely self-financed. During his speech commemorating the country’s independence, Bukele emphasized the importance of this fiscal strategy by declaring that no new debt would be issued to finance government operations.

El Salvador’s Commitment to Financial Independence

Bukele’s commitment to eliminating the need for new debt extends to covering debt interest payments with self-raised funds. He stressed that instead of relying on loans, the country would pay its financial obligations directly. This bold move toward financial independence is expected to yield long-term benefits, including a robust economy and a truly independent nation.

From crime fighting to economic reform

President Bukele’s first term was marked by an aggressive campaign against criminal gangs, which significantly improved national security. As he transitions to his second term, the focus is shifting to revitalizing the country’s economy. His administration has already attracted more than $1.6 billion in private investment and implemented measures to combat rising inflation.

Positive market reactions

Global markets have reacted positively to Bukele’s announcement. Salvadoran bonds have rebounded, reaching their highest levels since 2021, reflecting growing investor confidence. However, the country is still struggling with a significant public debt, which currently stands at more than $31 billion, including pension liabilities.

Conclusion

President Bukele’s introduction of a self-financing budget marks a significant milestone for El Salvador. By eliminating the need for new debt, the country aims to achieve financial and fiscal autonomy. While the path to full economic independence will take time and sustained effort, Bukele’s approach suggests a promising future for El Salvador’s economy.