According to the Peruvian Institute of Economics, four regions will enter recession

Peru’s economy has already lost S$2,150m due to the strikes sparked by the protests, but who will be hit the hardest?

According to him Peruvian Institute of Economics (IPE)the impact on economic activity will mainly affect the four regions entering into recession.

Puno, Cusco, Apurimac and Madre de Dios these are regions that have seen an economic downturn over the past three months that could end in a recession.

“While the economy is slowing down on the national stage, it is highly likely that we will face a recession in the economy of the southern regions, mainly in Puno, which is almost paralyzed, and also in Cusco, where tourism activity has been hit very hard. like Madre de Dios and Apurímac,” Victor Fuente, chief economist at IPE, told Correo newspaper.

What is a recession? A recession implies that the country’s economy will have at least two consecutive quarters of falling GDP, meaning its production will fall for six consecutive months.

It is worth noting that last year the forecasts of the International Monetary Fund (IMF) indicated that by 2023 at least a third of the world’s economies would enter a technical recession.

Fuentes notes that it is likely that these four regions would have already registered negative numbers in the last months of 2022, and depending on how protestsserious problems will also be observed in the first three months of this 2023.

Another region that will be affected by the blockade is Ica, as it has been paralyzed for more than 20 days, mainly affecting agricultural exporters.

In the case of agro-exporters alone, the National Society of Industrialists (SNI) estimated that 300 companies were affected, with losses from unrealized sales estimated at S$470 million.

At the national level, data are also available on the impact on mining sectorwhich will already be affected in 2022. It is estimated that at the end of last year, mining production decreased by an average of 0.3%.