Corruption: how does it affect the economy of Peruvian families?

Last year, the state lost more than 24 billion soles due to corruption. Controller Republic, that is, 13 out of every 100 soles of the state budget.

According to the estimates of the Accounts Chamber, two central highways, 50 equipped hospitals or more than 1,600 schools could be built with the lost resources.

“These resources would serve to finance almost two-thirds of the deficit in investments for the education sector. Similarly, in the security sector, 68% of the gaps could be closed,” explained Armando Canchanha, spokesman for the Office of the Comptroller.

Corruption particularly affects the poorest, as they are the ones who allocate the majority of their income to access basic services.

economist Peruvian Institute of Economics (IPE)Victor Fuentes points out how corruption hinders the reduction of social gaps by affecting the most vulnerable more.

“A poorly constructed road due to stolen funds means higher costs for car repairs. In addition, a state hospital that does not have equipment in optimal condition as a result of fraudulent contracts forces patients to pay for tests in private institutions. which should otherwise be free in hospitals,” he said.

Esan University professor of administration and finance Edmundo Lizarzaburu noted that the amount could be around 5% or 6% of GDP and agreed on how this affects poverty.

“Due to the cost overruns that are part of corruption, unfortunately it will be created that the possibility of poverty reduction will start to be delayed because somehow the products will become more expensive, what will happen is that the expenses of a person with a minor income They will have to take care of themselves, that is, they will stop consuming, they will stop learning, and this will keep them in the poverty zone,” he added.

The Comex analysis states that on average a citizen loses 720 soles per year due to the delay caused by corruption. Similarly, IPE with data from the US National Bureau of Economic Research (NBER) indicates that if there were less corruption in Peru, Peruvians could earn more.

NBER junior researcher Roberto Chang points out that if Peru manages to rise to the level of Chile in the rankings, the income per inhabitant of each Peruvian this would be 27% higher than today, equivalent to an increase of approximately $1,800 per year.

This is in line with 9 out of 10 Peruvians who believe that corruption affects their daily lives, especially their family finances.

Development Research Network economist Monica Muñoz Najjar explained that she generates less in RPP the economic growth and more inequality.

“Things like that don’t help get out of this low growth trap, in fact one of the things that drives an economy is confidence, and if there is no trust in institutions, there is no certainty that the country will continue to improve. , so they don’t want to invest, and that limits growth, you don’t hire anyone else, so employment is limited,” he clarified.

A recent Bloomberg report indicates that investors are already looking at Peru as a country. unstable due to constant political crises and cases of corruption.

It is worth noting that the World Economic Forum indicates that corruption increases the cost of doing business by 10% and raises the cost of awarding contracts by up to 25% in developing countries.