After the national economy registered a fall of 0.63% in August, and thus accumulated a decline of 0.58% in the first eight months of the year, everything indicates that the macroeconomic projections for the end of 2023 would have a new downward bias, where the most optimistic forecast is currently that of the Ministry of Economy and Finance (MEF) with an advance of 1.1%.
Thus, poor GDP performance is reflected in the number of poor people in a country. According to the World Bank, 85% of poverty reduction is explained by the effect of economic growth.
Thus, on the International Day for the Eradication of Poverty, commemorated today, The projections on this indicator are not encouraging at all. and on the contrary they are worrying.
According to BBVA Research, which expects economic growth of just 0.4% at the end of the year, the monetary poverty It would increase in 2023 and 2024 and reach 28.9% and 29.2% of the population, respectively, approaching its peak during the pandemic stage, when it reached a rate of 30.1%.
In this way, 9.8 million compatriots would be below the poverty line in 2023 (9.2 million in 2022).
Hugo Perea, chief economist of BBVA, pointed out that to accelerate growth and reduce poverty, moving forward substantial improvements will be required in structural factors linked to the country’s governance and institutions.
Increase coverage
Likewise, the OECD—an economic forum to which we aspire to belong—warns that the quality of employment has deteriorated further and this could translate into “a persistent increase in poverty and inequality”.
Given this, the OECD suggests expanding the coverage and benefits of monetary transfer programs for the poor.
The data
Problem. The OECD indicates that Peru has low social spending compared to developed economies and other comparable Latin American countries, which is one of the main factors that explain the large coverage deficits in terms of social protection.
Source: Larepublica
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