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IMF: Gov't focus on infrastructure to boost Peruvian economy

Director del Departamento del Hemisferio Occidental del FMI, Alejandro Werner. Foto: FMI.

10:43 | Lima, Oct. 30.

Economic measures adopted by President Pedro Pablo Kuczynski's administration focusing on infrastructure works will have a positive impact on Peruvian economy, the International Monetary Fund (IMF) affirmed.

"IMF's appraisal of the measures implemented by this administration is positive," said IMF Western Hemisphere Director Alejandro Werner.  

In an interview with El Peruano official gazette, Werner praised the government's emphasis on infrastructure, tax changes to tackle informality and the fiscal expansion to address the slowdown in the first half of the year. 


GDP

Werner reiterated the Fund forecasts economic growth of 2.7% for Peru in 2017 and 3.8% in 2018, thus reinforcing the Inca nation's position among the leading Latin American economies

"We see that the primary sector [mining] will be a major short-term growth driver again, with rebounding prices and metal production. Secondly, we already observe an increase in public investment with infrastructure projects, which we expect to significantly contribute to GDP growth in the second half of 2017 and next year," the IMF officer said.

In addition, Werner projected greater progress in non-traditional exports in the medium term, as well as further growth driven by the construction sector.


Investment

Consulted on reforms to boost public and private investment, the IMF representative noted that, while adequate, their impact cannot be easily assessed in the short term given the considerable time required for investment projects. 

However, the Fund is "confident these effects will take place" and have a positive impact on Peruvian economy in the medium term. 

As for investment in infrastructure, Werner observed emphasis should be placed not only on the national government, but also on the local and regional levels, which bear considerable administrative burden. 

"There is also the need to 'clear the cobwebs' of permits to keep those that matter: protecting the environment, transparency issues and the fight against corruption," he noted. 

Lastly, the IMF director stressed the need to speed up infrastructure projects in regions in order to expedite the distribution of wealth and counter social unrest.

(END) DOP/CNA/MVB


Published: 10/30/2017
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