Private investment in Peru will see a significant recovery in 2017, expanding 5% after a 5.7% contraction in 2016, driven by the construction sector, which is set to benefit from large-scale infrastructure projects, Central Reserve Bank (BCR) General Manager Renzo Rossini projected on Wednesday.
Added to this major boost by infrastructure ventures is the mining sector investment, set to revive underpinned by improved metal prices and expected to end 2017 unchanged after declining over 49% in 2016, Rossini commented following his speech at a forum held by the Peruvian Finance Association (APEF).
A 5% rise in private investment next year posts a neutral scenario, since there are different factors that might adjust projections upward or downward.
“A better setting could be found if more enthusiasm arises as a result of further unblocking and deregulation; however, forecasts can be revised downward if the positive trend in mineral prices reverses,” he said.
Nevertheless, he believes government action is essential within that context, given that higher investment and optimism will depend on its unblocking and deregulation efforts.
According to the BCR official, the 5.0% expansion in private investment will push the country’s GDP growth to 4.5% by the end of 2017.
Next year’s GDP will be driven by exports whose growth is projected to reach 5.5%.
Moreover, private consumption is preselected to grow 3.8%, whereas public consumption will experience a 3.0% increase.
Rossini noted public investment will be the main driver of construction sector’s growth as well.
(END) RGP/JJN/RMB/MVB
Published: 12/7/2016