"Peru has become Latin America’s macro-economic star, combining sustained high economic growth with low inflation",says Joachim Bamrud editor of Latinvest magazine and former editor of Latin Business Chronicle and Latin Trade, in a recent analysis based on IMF data. More from his analysis below
- Peru has had the region’s second-lowest inflation despite having the second-highest GDP growth rate. The economy grew on average 6.5 percent in the 2008-12 period, while its inflation remained at an average of 3.5 percent.
-Peru is expected to see Latin America's second-lowest inflation rate in 2013 ( 2.1%)as well.
- As a result of its strong GDP growth and low inflation, Peru is expected to have Latin America’s second-highest increase in purchasing power this year.
- For the past eight years – during the period 2005 through 2012 – Peru’s GDP has consistently been higher than that of Latin America each year. While Peru’s economy grew on average 7 percent during that period, Latin America’s GDP expanded by 4.1 percent.
- Overall, Peru has a very favorable business climate. It has Latin America’s best environment for doing business, according to The World bank’s latest Doing Business report.
- In 2012, foreign direct investment grew 48.8 percent to a record $12.2 billion. That’s almost as much as Mexico received ($12.7 billion).
Bamrud says that the Peruvian success of high growth with low inflation could be studied by Brasil which is struggling with low growth and high inflation.
Of course, Peru has the usual developmental challenges of poverty, inequality, infrastructure and education. But Peru is progressing in the right direction under the leadership of President Ollanta Humala who pursues Inclusive Growth policy in a pragmatic and mature manner and, setting himself as a role model for other leaders in the region.