01803cas a2200253 a 4500 AALejournalIMF017243 230101c9999 xx r poo 0 0eng d 5.00 USD 9781475555158 1018-5941 BD-DhAAL BD-DhAAL David, Antonio. A Balancing Act : Reform Options for Paraguay's Fiscal Responsibility Law / Antonio David, Natalija Novta. Washington, D.C. : International Monetary Fund, 2016. 1 online resource (33 pages) IMF Working Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students Paraguay faces a trade-off between building fiscal credibility and amending the existing fiscal rule to accommodate infrastructure investment and provide space for countercyclical policies. In this paper, we discuss several alternative fiscal rules for Paraguay and present simulations of debt trajectories in each case, assuming a baseline and three deterministic shock scenarios. We provide a supplementary Excel file to replicate debt simulations under different fiscal rules. The results suggest that potential modifications to make the fiscal rules more flexible in Paraguay should be accompanied by a number of safeguards that enhance credibility of the fiscal anchor and preserve sustainability. Mode of access: Internet Novta, Natalija. IMF Working Papers; Working Paper ; No. 2016/226 Full text available on IMF http://elibrary.imf.org/view/journals/001/2016/226/001.2016.issue-226-en.xml IMF e-Library