:quality(85)/cloudfront-us-east-1.images.arcpublishing.com/infobae/YL6GV5EVJVAXPJ3RJPSK3LNDJE.jpg "According to the MEF, for the second year in a row, Peru will not meet its funding target")
This year, one of the concerns regarding the economy is that Peru may return to its status quo Lack of funds Within the recommended limits – this indicator defines the difference between the country's total income and expenses, and it is recommended that it should not exceed one percent every year.
To recall, 2023 will be the first time in the last 22 years that the country has breached the fiscal rule. 2.8% of GDP, while the margin was 2.4%. Thus, Alex Contreras exits and enters Jose Arista Al Ministry of Economy and FinanceThis year the result was expected to be reversed.
However, its owner MEF, at a hearing of the Congressional Oversight and Comptroller Commission, announced that it would not happen this year. What purpose has this served the Peruvian economy?
Measurements Minister Arista They have gone on to promote austerity in government as a way of cleaning up the public accounts – which -. However, this may not be enough to curb the fiscal deficit.
“Our main objective is financial stability. And it means keeping the increased spending demand we have and managing it based on the income we have. The funding target for this year is 2%, but at this stage in the game, I think it should be a little higher. Because with 2% we are pushing and controlling overspending, I don't think that is important now,” the president revealed. MEF.
So, the Minister has actually suggested this limit Lack of funds Could be more. This is what former minister Luis Miguel Castilla predicted in an interview Infobae Peru. “In a recent article by the International Monetary Fund, in which they assess the Peruvian economy and public finances, they warn that Peru is a country that can and will probably want to do so. High fiscal deficit Fiscal adjustment puts the recovery back on track without undermining the economic recovery. “I think that shows me, if that's the case, that they're having a hard time complying with the rule,” Castilla said.
how much is Lack of funds Currently in Peru? Minister Arista put the fiscal target for this year above the proposed limit, which is 2%.
“Our fiscal deficit is at a low rate of 2.6% this year. 2.5%, 2.2%, overall, Latin America moves to 5.3%. This gives the country almost half the risk they give to other countries, from the point of view of the international market of rating agencies. We have 1.95 basis points of risk for the period from January 2022 to March 2024, while emerging countries have almost double that, 3.85 points,” the chairman explained. MEF.
You know, last year Peru's country risk index ended at 1.95 percentage points, calculated by investment bank JP Morgan. At this level, the lowest country in the region was Brazil with 2.63 points and Mexico with 3.86 points. This indicator measures the political risk and likelihood of a country defaulting on its obligations related to paying its international debts.
However, for Minister Arista, in this favorable environment, Mr The fiscal target for 2024 is 2%, may be higher. So, it cannot be ruled out that this may change this year.
