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Peru: 2025 Budget strengthens decentralization policy, allocates 45% to regions

00:00 | Lima, Dec. 4.

Economy and Finance Minister Jose Arista announced that the Public Budget Law for Fiscal Year 2025 has a clear decentralizing intent for public resources, as established by the Executive Branch.

The government official explained that, although 36% of the budget has been allocated to Peruvian regions, the Executive Branch's portfolios also have projects in these regions.

Thus, the resources to be granted directly and indirectly to these jurisdictions will surpass 45%.

"There are resources included in the budgets of the Ministries of Education, Health, Housing, and Transportation-Communications; at the end of the year, when these transfers are made to the various local and regional governments, this figure will exceed 45%," he stated.

Total budget

Minister Arista explained that the budget presented by the Executive Branch amounts to S/251 billion (above US$67.130 billion) and prioritizes, among other aspects, the allocation of resources to key sectors such as citizen security.

In this regard, the sector's head reported that the budget approved on November 30 by the Legislative Branch also prioritizes this issue nationwide, granting resources to the entire justice system, with the aim of controlling and combating insecurity.

"Not only are more resources being allocated to the Ministry of the Interior, but the entire process is also being strengthened, starting with the Ministry of Justice, on which prisons depend; indeed, a debt of over S/3 billion (approximately US$802 million) is being approved for the construction of prisons, with involvement from the Public Ministry and the Judicial Branch," he stated.

Impact

The Cabinet member indicated that insecurity has a widespread impact on different economic sectors.

He explained that, according to the Inter-American Development Bank (IDB), the country's GDP could grow by up to 5% if the insecurity levels, which create instability in investments, are reduced.

Other priority sectors in the 2025 Public Budget include social protection and assistance; potable water and sanitation; defense; and agriculture and risk (management).

In this regard, Minister Arista indicated that emphasis is also placed on infrastructure development.

"The easiest way to reach average citizens, make their life easier, and reduce their costs is through infrastructure projects. There, we need to focus more on schools, hospitals, roads, bridges, airports, which, at the end of the day, are what make life easier for citizens," he concluded.

(END) NDP/SDD/MVB

Published: 12/4/2024
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