## Nicaragua: Selected Issues

_IMF Staff Country Reports, June 27, 2017_

## Source details

**Canonical URL:** [Nicaragua: Selected Issues](https://www.imf.org/en/publications/cr/issues/2017/06/27/nicaragua-selected-issues-45009)

## Other formats

- [Markdown version](/en/publications/cr/issues/2017/06/27/nicaragua-selected-issues-45009/index.md)
- [Structured JSON version](/en/publications/cr/issues/2017/06/27/nicaragua-selected-issues-45009/index.json)
- [Bundle manifest](/en/publications/cr/issues/2017/06/27/nicaragua-selected-issues-45009/bundle-manifest.json)

## Bibliographic details
- Published: June 27, 2017
- Series: IMF Staff Country Reports
- DOI: https://doi.org/10.5089/9781484305645.002

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### Overview findings
- The social security system is projected to run out of liquid reserves by 2019.
- The anticipated exhaustion of reserves occurs several years earlier than previously expected.
- To avoid burdening the budget, reforms to the system are urgently needed.
- A politically acceptable, pragmatic solution appears within reach, but authorities should act quickly to avoid a costly bailout of the system.

### Projections and risks
- Projection: liquid reserves exhausted by 2019.
- Risk: exhaustion would likely require a fiscal bailout that would burden the budget.
- System type: defined-benefit, pay-as-you-go, which must be sustained for another generation of workers while maintaining improved health care benefits.

### Analysis needs and reform design
- Required analyses:
  - A deep actuarial analysis.
  - A deep economic analysis.
  - A deep operational analysis.
- Purpose of analyses: to design a comprehensive reform program that ensures the sustainability of pension benefits and the maintenance of improved health care benefits.

### Policy recommendations (high level)
- Implement a comprehensive reform program informed by actuarial, economic, and operational analysis.
- Ensure reforms allow the defined-benefit, pay-as-you-go system to sustain itself for another generation of workers.
- Preserve improved health care benefits alongside pension sustainability.
- Act quickly to implement reforms to avoid a costly fiscal bailout.

*International Monetary Fund. Nicaragua: Selected Issues. June 27, 2017.*

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## Content in this bundle

- **Country Report**
  - [Country Report (Markdown version)](/-/media/files/publications/cr/2017/cr17174.pdf.md){rel="alternate" type="text/markdown"}
  - [Country Report (PDF)](/-/media/files/publications/cr/2017/cr17174.pdf){rel="external" type="application/pdf"}

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_Source: https://www.imf.org/en/publications/cr/issues/2017/06/27/nicaragua-selected-issues-45009_