on Friday indicated that the approval of a supplementary credit worth S/1.581 billion (about US$408 million), proposed by the Government and to be debated at a Congress plenary session today, may help Peru overcome the current recession.
Last Thursday, Parliament's Budget and General Account Commission approved the Executive Branch Draft Bill No. 5997, which authorizes supplementary credit worth over S/1.581 billion to finance, exceptionally, the economic reactivation and actions against El Niño Phenomenon, among other measures.
The Cabinet member acknowledged that Peru is in a difficult situation.
"Without any doubt, this is a recession, I have no doubt; what we want is to get out of this recession thanks to the supplementary credit," Contreras said as he entered Congress facilities to support said initiative.
According to him, the supplementary credit is equivalent to a five-point boost to GDP.
He added it is a properly-calibrated and fiscally-aligned stimulus, which will enable Peru to come out of recession.
"It is what is going to get us out of this difficult context. At no time did we underestimate the situation; it was basically a very academic discussion that we deemed at the time as unnecessary, but the situation (now) is completely difficult (…)," he explained.
Peru has two major challenges
1. The country's economic reactivation.
2. Preparedness for El Niño Phenomenon.
"These are the two central elements of this supplementary credit, which I hope can be approved today so as to make this last effort of the year and move the economy forward," he noted.
Fight against poverty
Moreover, the
minister affirmed that the supplementary credit incorporates concrete measures for social protection and the fight against anemia.
"Similarly, it has a very important current spending component, taking into account the execution and (the fact) that there are two months left (for the end of 2023)," he remarked.