Sergio Díaz-Granados: “This year is decisive to lay solid foundations and not everything is a simple rebound”

After overcoming the alarming economic indicators left by the productive contraction of 2020, from the Development Bank of Latin America (CAF) they string together their perspectives for the third year of the pandemic under the reins of the government of Pedro Castillo, with whom they spoke the day before.

What are your impressions after the meeting with President Pedro Castillo?

We reviewed the current situation in the country and the socioeconomic challenges. We are left with very specific messages about where we can be much more effective from CAF this year, such as concentrating on the border population and strengthening public health. We recently approved an operation for 120 million dollars for the acquisition of vaccines (against Covid-19). We still have specific initiatives for connectivity and broadband access in the country. We agree on the need to strengthen economic integration processes. That was, in essence, the meeting with the president. We had a very understanding talk.

After solid economic growth of 13% in 2021, what is expected to keep the country on that path?

I think that last year closed well in terms of economic growth because the fall (of 2020) was compensated. At CAF we are going to promote growth by working hand in hand with Cofide to support MSMEs in alternative solutions and with sectors with potential growth. The most important thing is to generate GDP and expand it. There is a large margin in Latin America, not only Peru, where we can increase GDP generation and growth.

Do the recovery figures for this year guarantee a reduction in poverty?

I believe that the challenge for the entire region is common, since unemployment is high and informality occurs despite economic growth. The generation of employment does not reach the level that is needed. This year is decisive to lay solid foundations for growth and that it is not a simple rebound. This will come from the hand of the private sector. Stimulating private investment is necessary for Latin America and the Caribbean. Conditions and guarantees must be given.

How do you perceive the tensions between Congress and the Government? Can they undermine business expectations?

We try to concentrate on the good execution of the Government. A healthy democratic debate is important for the entire region. Necessary. The investor in general is used to living in the middle of the discussions of a democracy, but more important is the search for freedom and stability. Always look long term. I don’t think the investor has a deep concern about that (in reference to the tense spirits between both powers). There are solid foundations today to promote further economic growth. At CAF we are not associating the specific discussions of one week or another with long-term decisions for the growth of Peru.

What do you hope to achieve in the medium term?

We have had a significant presence in Peru, with annual disbursements and approvals approaching US$1.2 billion. We hope to continue with that presence because up to 50% of the resources go to the private sector. Mipymes and the infrastructure sector are irrigated. Our intention is to continue present with border infrastructure projects and, recently, we have opted for the recovery of the Rímac River to improve the capacity of the center of Lima and make it a dynamic engine of job creation.❖