President of Peru, Ollanta Humala (photo: dpa)

Peru 2015: inept leadership threatens to undermine growth in spite of strong fundamentals

The last decade and a half of spectacular growth has made Peru a showcase for Latin America’s success. The country has built up a sizeable middle class and reduced poverty. Its democracy is functional and its economic fundamentals are exceptionally strong. Unfortunately, the poor leadership provided by many of Peru’s politicians has adversely affected the business climate.

Peru’s economy is in decent shape by any objective metric. The country has been on a path of steady growth and its GDP has continued to expand in spite of a recent slowdown, at a clip better then the regional average. Yet the mood in Peru is hardly upbeat. The public’s concerns are mostly of a political, but also so...

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 Carlos Basombrio
Economists see ample room for countercyclical policies. Peru has, for example, accumulated public savings to the tune of US$30 billion. At least some of that money could be injected into the economy.
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