Peru will celebrate its 203rd anniversary in a year marked by political turmoil and fiscal deterioration that will put unnecessary pressure on public spending in the second half of the year.
After only about 37.4% of the public budget had been spent by mid-July (37% national; 36.2% local and 39.7% regional), Public Policy expert from the PUCP School of Government Flavio Ausejo anticipated three scenarios that will complicate the development of public works for the benefit of the population: an unprecedented confrontation between the MEF and the BCRP over monetary policies, loss of technical capacity of operators and decision-makers of the projects, and a lack of government promoted by a Congress with a broad spending initiative.
“In economics, we operate on the basis of expectations and signals. The dialogue between two key entities for macroeconomic sustainability is taken very seriously by international agents,” Ausejo explains.
In this regard, the PUCP specialist warns that, although investment has recovered slightly, those who will have to assume the execution of the promises that may be made during the celebrations of July 28 and 29 “do not necessarily have the strategic capacity” to do so, in addition to being affected by high turnover and lack of leadership at all levels.
“Invierte.pe requires certain capabilities; not just anyone can put together a public investment project, and even less so anyone can execute it successfully,” adds Ausejo.
Cracks at the end of 2024
For the professor, this is a “unique historical moment” for organized society to actively participate in the political life that defines the course of the little income that the State can generate.
Recently, the Government decided to change the path of the deficit to allow it to spend more than it earns, in an attempt to sustain GDP with public investment, despite the slow progress of its implementation.
“And businessmen are gradually becoming aware that they cannot generate any type of sustainable activity with an Executive and Congress of these characteristics,” he says.
Chinese capitals in 2024
● The PUCP researcher also warned of a massive influx of Chinese capital in the second half of the year due to the inauguration of the port of Chancay, which will take place in a scenario of instability that will prevent the country from defining its objectives in relation to this capital.
Source: Larepublica
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