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Peru PM: Government seeks GDP growth of 5% by 2021

15:02 | Lima, May. 2.

Peruvian Government's commitments —in economic terms— include achieving GDP growth of 5%, placing private investment growth at 8%, and reducing poverty by 18% in 2021, Prime Minister Cesar Villanueva said on Wednesday.

"We want orderly, sustainable, decentralized, and equitable growth with clear accountability, transparency, and plenty of dialogue," Villanueva said at Congress, where he set out his administration's guidelines to request a confidence vote.

In his speech, he emphasized the first project his team has embarked on has to do with cost optimization. 

Plus, he said the Cabinet has initiated a review of tax exemptions in cases where people reap no profit.

Tax exemptions

"We propose to gradually substitute tax exemptions with direct and equivalent allocations to regions. These resources shall be used to invest in infrastructure, production, and greater connectivity, as well as in projects that do benefit society," Villanueva noted.

Peru's Prime Minister stated that the Cabinet's first goal is to gradually reduce the fiscal deficit by 2021 and increase the tax burden by 2.4 percentage points of GDP to 15.3% in 2021.

"We'll support the idea of making Sunat's (Peruvian tax agency) collection process more efficient. Tax administration will be very executive and focus its work on expanding tax rate, as well as reducing tax evasion and avoidance. The use of digital tools that foster collection capacity will be reinforced as well," he noted.

According to Villanueva, the second line of action —in economic terms— is to adopt a quality public investment policy across the country, thus prompting the articulation of economic potentials and contributing to poverty reduction.

Considering the three levels of Government, more than S/180 billion (US$55.3 billion) will be allocated for public investment execution, with works all over the country so as to reduce infrastructure gaps and improve connectivity.

"That is the Government's commitment," he emphasized.

(END) CNA/RMB/MVB

Published: 5/2/2018
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