Peru: Local governments' public investment boosts construction sector

10:20 | Lima, Aug. 18.

Public investment by local governments has been one of the principal drivers of growth in the construction sector so far this year, private-run Peruvian Chamber of Construction (Capeco) Executive Director Guido Valdivia reported on Wednesday.

"In fact, investment in public works has increased significantly in recent years, mainly in local governments," he told Andina news agency.

Valdivia explained that a large portion of this increase is related to the Arranca Peru (Get off the Ground, Peru) program implemented by the Government to contribute to the reactivation of the economy, which was severely affected by the COVID-19 pandemic.
The National Institute of Statistics and Informatics (INEI) has reported that the construction sector grew 90.74% in June this year, over the same month in 2020, when public and private projects were suspended, except some projects related to mining activity.

Rebound effect

The executive officer explained that this growth is also explained by a rebound effect, considering that the construction sector was practically paralyzed in the first months of last year (March, April, and May).

Nevertheless, he noted that positive growth rates were observed in May and June this year, in comparison with similar months of 2019.

In addition, Valdivia remarked that housing construction favored the performance of the sector.

In this sense, he highlighted the increased construction of social houses. "It showed a higher growth rate compared to non-social houses."


Published: 8/18/2021