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Analysis & opinionJanuary 2 2017

Alfredo E Thorne: Priming Peru’s new engines of growth

Economic growth in commodity-dependent Peru is unlikely to surpass 5% in 2017, prompting the Kuczynski government to devise a plan to boost the economy that focuses on investment in infrastructure and improved productivity. 
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As with most highly commodity-dependent emerging countries, Peru’s economy was pushed into a deceleration phase by the drop in global commodity prices that began in 2012. Real gross domestic product (GDP), having averaged 5.7% between 2001 and 2011, slowed to 4.2% in the first three quarters of 2016.

Although this was still high by emerging market standards, the drop in GDP did highlight Peru’s dependency on its commodities output. Of this 4.2%, 2 percentage points were attributable to copper exports, and government and private expenditure added 1 and 1.2 percentage points, respectively.

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Silvia Pavoni is editor in chief of The Banker. Silvia also serves as an advisory board member for the Women of the Future Programme and for the European Risk Management Council, and is part of the London council of non-profit WILL, Women in Leadership in Latin America. In 2019, she was awarded an honorary fellowship by City University of London.
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