Peru’s Finance Minister says “strong” rebound limits the need for fiscal profligacy Reuters

Marco Aquino

Lima (Reuters)-The current Minister of Economy Valdo Mendoza said that Peru’s mining-driven economy will see a “strong” rebound this year, which should limit the need for the new government that will take office on July 28 to open up fiscal expenditures . on Monday.

Mendoza said that due to the financial injection, Peru’s economy will grow by at least 10% this year and 5% next year, while benefiting from high global commodity prices, including the country’s most important export products.

Andean country, No. 1 in the world. The second largest copper producer after Chile, is waiting for the socialist Pedro Castillo to formally confirm the next president after he defeated conservative rivals by a narrow margin in the June 6 election. He promised to raise mining taxes and increase medical and education spending.

Mendoza said at a press conference: “Due to the recovery of companies backed by large credit programs funded by state guarantees, we can grow by 10%, 11% or even 12% this year without any additional fiscal stimulus.”

In comments on a possible new left-wing government, Mendoza said that tax increases should be cautious so as not to affect economic competitiveness, and that his team intends to share proposals with the new government.

Castillo is a farmer’s teacher and son. His proposal to reform the mining law and constitution disturbs the political and business elites of the Andean countries, although he recently hopes to win investors with more favorable terms for the market.

Mendoza said: “The temptation to increase consumption and debt is the temptation we should not fall into.” “Macroeconomic stability is necessary, and we should not underestimate it.”

Mendoza said that the current government will leave a “very stable” public account, with international reserves accounting for 36.7% of gross domestic product (GDP) and public debt accounting for 34% of GDP. Compared with neighboring countries in the region, At a strong level.

“The external environment is great,” he said. “This is an additional boost to the recovery. The recovery is going well and it is very strong.”