Selected Issues Papers

Guatemala faces the challenge of closing persistent social and infrastructure gaps with one of the lowest public spending levels among developing economies. This low level of spending reflects the state’s limited capacity to expand service coverage, improve quality, and reduce long-standing disparities in secondary school attendance, maternal and child health, and access to water and sanitation. In support of the government’s efforts to improve the quality of spending, this paper provides a preliminary diagnostic of spending adequacy and efficiency in education, health, social assistance, and infrastructure, using an aggregate and sectoral lens, and assessing some of the institutional and PFM constraints hindering the government’s capacity to plan, execute and evaluate allocation of public resources.