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Peru: Consumption, private investment will contribute 19.9 points to 2021 GDP

Photo: ANDINA/Archive

Photo: ANDINA/Archive

13:00 | Lima, Nov. 24.

Economy and Finance Minister Waldo Mendoza on Tuesday projected that private investment and consumption will contribute 19.9 points to GDP growth in 2021, which would reach an expansion rate of 10%.

In his presentation before Parliament's Budget Commission, the high-ranking official explained that GDP expansion (+10%) next year will be based on private consumption recovery. This will contribute 10.5 percentage points to said growth. In this sense, private consumption would go from -9.6% (2020) to +6.5% (2021).

Furthermore, private investment will contribute 9.4 points to GDP growth in 2021. Besides, this type of investment will climb from -34.25% (2020) to +21.0% (2021).

Meanwhile, public spending will add 1.9 points to next year's expansion. It will register a growth of 0% in 2020. Nonetheless, it will record an increase of 10.6% in 2021.

Recovery

Likewise, Minister Mendoza projected that Peru will register a rapid economic recovery in the second half of the current year and will be the country with the greatest dynamism in the region.

"Peru is one of the countries that has fallen the most, but we are the ones that are recovering at the fastest pace. There is the prospect that we (the national economy) will end the year more or less well, and that 2021 will be a year of frank recovery," he told Congress members.

The Cabinet member also reported that the Peruvian economy fell 17.1% in the first quarter of 2020, but will recover in the second half and merely decrease by 7.1%.

"If we see 2020 as a year, we are going to say that it is a bad year. However, if we divide it into semesters, we can say that there is a positive trend in the figures, which is something encouraging," he remarked.

Lastly, the government official recalled that —due to the strict social isolation decreed last March aimed at containing the spread of COVID-19— the economic activity came to operate at 60%, but today it is already bordering 100%.

(END) RGP/JJN/MVB

Published: 11/24/2020
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