This paper estimates the effects of fiscal consolidation on economic activity based on a new narrative dataset for 14 countries in Latin America and the Caribbean (LAC). Following a Romer and Romer identification approach, we examine contemporaneous policy documents to identify changes in fiscal policy motivated by a desire to reduce the budget deficit and not by responding to prospective economic conditions. We find that a fiscal consolidation of 1 percent of GDP reduces real GDP by, on average, 0.9 percent in two years. The estimated effects are close to those we find for advanced economies based on a comparable narrative dataset. We also find a strong LAC "twin deficits" relation, with a 1 percent of GDP fiscal consolidation raising the current account balance by, on average, 0.8 percent of GDP.