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Macro Scenario – Peru: Policy uncertainty originating in Congress

September 3, 2020

Fiscal accounts deteriorate amid COVID-19 shock

For the version with all charts and tables, please open the attached pdf file

• The final reopening phase of the economy will be delayed until the end of September or beginning of October. Meanwhile, new daily cases of COVID-19 seem to have stabilized as of the end of August, after a reacceleration at the beginning of July when social distancing measures were lifted.

• Uncertainty lingers, created by market-unfriendly reforms in Congress. Lawmakers approved a reform of the public pension scheme that could put additional pressure on fiscal accounts, while they are also analyzing whether to allow private pension fund affiliates to withdraw 100% of their pensions under certain conditions.

• The Ministry of Finance revised its fiscal balance projections downward for 2020, reflecting economic conditions during the COVID-19 pandemic. The projections include a fiscal consolidation plan starting in 2021.

Joao Pedro Resende
Julio Ruiz

For the version with all charts and tables, please open the attached pdf file
 



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