Moody's Investors Service does not expect a significant variation from Peru's current policy stance on macroeconomic management, following Pedro Pablo Kuczynski's resignation and
According to Moody's, the quick transition witnessed last week shows a continuity of policies in the Inca country, thus reducing the risk of political uncertainty, if early elections had been called.
"For now, we are maintaining our baseline
forecasts for Peru of 3.5% growth in 2018-19, and we do not anticipate changes to Peru's A3 rating and stable outlook resulting from the change in the presidency," the credit rating agency notes.
Additionally, Moody's underlines that even though the current political crisis could affect business confidence and the overall economic performance, this will not considerably hinder the country's trade and industry.
It must be noted the economic and political uncertainty could also affect consumer confidence, leading to a slowdown in consumption. Yet, the product and geographic flexibility will help consumer-packaged-good-producers and retailers keep their credit quality and ratings largely intact.
"Despite the political crisis, Peru's strong track record and institutional framework will keep underpinning its infrastructure investment," it remarks.
Furthermore, the international agency does not expect significant changes in terms of policies or regulation for industries like
mining or infrastructure.
"However,
changes in cabinet from the new administration could result in delays to assign projects currently in the pipeline […]," it warns.
Finally, Moody's expects a minimal impact from Peruvian political change in more stable industries such as telecommunications, and —even—
fishery.
(END) NDP/JAA/MVB