What regions can go into recession due to the socio-political crisis?

Several regions of the country may face economic downturn To social and political crisis before the country, which already in the third quarter of 2022 registered negative indicators and low growth rates in Tacna, Huancavelica, Ayacucho, Puno, Apurimac, Ica, Piura and Amazonas, alerted Development Research Network (networks).

“Restoring the good economic performance of these regions could be even more difficult given that the national economy posted lower growth in the fourth quarter of 2022 compared to the previous three,” Cesar Garcia, an expert, said in a statement released today. Monday for networks.

The agency indicated that roadblocks and the paralysis of some economic activities affected the growth of the national economy in the last quarter of the year and at the beginning of this year.

He recalled that, according to the National Institute of Statistics and Informatics (ERI), the Peruvian economy grew by 1.7% in the fourth quarter of 2022, which is “much lower” than in the first three quarters.

This situation, he warned, could complicate the economic performance of regions that already had negative growth rates in the third quarter of 2022, such as Puno (-0.6%), Apurimac (-0.4%), Cusco (0.6% ) and Madre de Dios (1%) who could enter recession.

Garcia pointed out that it is “important to know the difference between a recession and a crisis” as the latter “has implications for productivity, purchasing power, and the stability of investments and financial markets”, while during a recession this “economic scenario is transient”.

He also said that the various growth projections offered for Peru, from 3% to 2.3%, according to national and international public and private organizations, “there is a common thread between them that they are not enough to reduce the poverty faced by a country.

Socio-political crisis

Peru has been experiencing an acute political and social crisis since early December last year, when anti-government demonstrations took place in various regions, mainly in the south of the country, as a result of which, according to various sources, 70 people were killed.

The crisis began after then-President Pedro Castillo announced on December 7 his intention to shut down Congress, rule by decree and intervene in the judiciary, which led the Legislature to fire him and install Dina Boluarte as then head of state Vice President.

Since then, protests have been unleashed, demanding mainly the resignation of Boluarte, the closure of the Congress, the calling of a general election and the calling of a constituent assembly.

Last Thursday ERI reported that Peru’s gross domestic product (GDP) grew by 2.7% in 2022, with the growth rate falling to 1.7% in the last quarter of the year.

He ERI emphasized that the “economic downturn” in the last quarter of 2022 occurred in an international context of “lower global economic growth” and that throughout December, national production was undergoing a “slowdown” aggravated by the socio-economic crisis. a country.

(EFE)