The Central Reserve Bank of Peru (BCRP) indicated that, in terms of loss of the Gross Domestic Product (GDP), the cost caused by the crisis of the COVID-19 it is below that generated after the 1998 crisis, but it is higher than that recorded as a result of the 2008 International Financial Crisis.
According to the monetary entity, the current crisis would have made Peru’s GDP in 2022 still between 5% and 7% below the level it would have reached in the absence of the coronavirus pandemic. COVID-19according to preliminary calculations, as the health crisis continues to develop.
The behavior described is not unique to Peru, since the estimated long-term loss for our country is relatively similar to that of its peers in the region (Brazil, Chile, Colombia and Mexico), even though we had one of the strictest quarantines in the world.
On the impact of the pandemic, the literature presents various perspectives. On the one hand, some argue that crisis they can facilitate the implementation of beneficial political and economic reforms, in addition to allowing the most inefficient firms to be eliminated from the economy, thus leading to greater productivity and growth.
However, the economic literature and empirical evidence suggest that major economic crises often leave “scars” (permanent effects) on economies. Changes in the dynamics of employment and the accumulation of physical capital, as well as the decisions of investment in R&D (investment plus development) or migration of productive factors between sectors, probably alter the path of long-term growth.
Source: Larepublica
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