Chile’s new government is preparing belt-tightening measures after inheriting a larger-than-anticipated fiscal deficit from its predecessor, but the measures will stop short of “mega-adjustments,” Finance Minister Felipe Larrain said on Monday.

Conservative billionaire Sebastian Pinera took office on Sunday vowing to combat economic “stagnation” and calling for a return to “fiscal equilibrium” as he seeks to transform Chile into a developed nation within a decade.

“We’re in a period of tight budgets, with levels of public debt that have doubled, which means we must begin with austerity measures, followed by a reassigning resources, in order to finance the president’s program,” Larrain told reporters as he entered the finance ministry for his first day on the job.

Shortly before leaving office, outgoing President Michelle Bachelet’s government reported it had left a fiscal deficit of 2.1 percent of gross domestic product, instead of 1.7 percent as targeted.

Chile’s Congress this year authorized an increase in public spending of 3.9 percent, which Pinera had previously criticized as “high.”

“These austerity measures, and the wise use of resources, are always welcome and are necessary. But we’re not talking about mega-adjustments, we’re talking about austerity measures,” Larrain said.

During his campaign, Pinera, who also governed from 2010 to 2014, said he hoped to guide the country to fiscal equilibrium within six to eight years.
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