For the second consecutive year, Peru will not comply with the fiscal rule that set the 2024 deficit at 2.8% of the Gross Domestic Product (GDP). According to the projection of the Central Reserve Bank (BCR), this indicator will reach 3.3% of GDP this year. This projection is similar to the one recently granted by the Fitch Ratings agency.
Look: BCR maintains its growth projection of 3.1%
The president of the BCR, Julio Velardestated that there is no interest at the different levels of government and Congress, nor is the due importance given to maintaining fiscal responsibility, and assured that “they believe they can spend almost without limits.”
“There are a lot of initiatives that are dangerous (for spending),” he added.
He also stressed that the BCR’s projection also includes the Executive’s new bailout of Petroperú, which also aims at restructuring the oil company.
It should be noted that within the monetary entity’s Inflation Report it is emphasized that the result to August (4% of GDP) “is explained by the fall in income, the increase in public investment and the primary deficit of Petroperu”.
Similarly, Velarde explained that both the new financial support to the state company and the one granted in February represent an expenditure of 0.6% of GDP in 2024.
Look: Petroperú’s Board of Directors will be announced next week
ON THE RISE
On the other hand, the president of the BCR revealed that the entity maintains its economic growth projection of 3.1% for this year, although he added that there is an upward bias.
Regarding private investment, Julio Velarde said they expect a 2.3% increase, similar to what they had projected in June. Here, mining expenditure stands out, which is expected to increase by 6.4%.
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