Andina

Peru has sufficient fiscal space to run countercyclical policies

09:14 | Lima, Aug. 17.

Peru has the necessary fiscal space to employ countercyclical policies in case external shocks get worse as a result of an intensified trade war and the crisis in Turkey, Deputy Economy Minister Hugo Perea affirmed.

"Having sufficient fiscal space remains important. We are working to consolidate public finances in order to replicate with countercyclical measures in case of an eventuality," he said after speaking at Peru CFO Summit 2018.

While fiscal space is more limited than in 2008, he explained, it is still sufficient.

"There is still fiscal backing and muscle, even though the (fiscal) space is lower than in 2008," he stated.

Leading the region

On the other hand, Perea noted that Peru will continue growing at high rates and leading the region in the 2018-2021 period.

The official estimates the Inca nation will see an average annual real growth rate of 4.4% between 2018 and 2021, above Chile (3.5%), Colombia (3.1%), Brazil (2.4%), and Mexico (2.3%).

"We expect Peru will keep leading growth in the region. It will be the most dynamic among major Latin American economies since the country offers interesting investment opportunities," he remarked.

(END) RGP/RGP/RMB/MVB

Published: 8/17/2018
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