Publication: Peru Public Finance Review: Mobilizing Resources for Service Delivery and Growth
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2025-11-26
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2025-12-12
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Peru, once a high-growth economy achieving significant reductions in poverty, now faces stalling progress, citizen distrust and political instability. After robust growth averaging over 6 percent in the early 2000s and poverty reduction from 59 percent in 2004 to 24 percent in 2014, progress came to a halt around 2013 with weakening institutions and a pause in the commodity boom. More recently, the COVID-19 pandemic had a severe impact on Peru, which recorded the highest mortality rate globally. The pandemic intensified political instability, fueling public frustration in Peru, and delaying essential policy reforms. Today, over 90 percent of Peruvians distrust their government, a 25-percentage-point (pp) increase from 2011. Peru’s potential growth is around 2.5 percent, requiring 64 years to reach high-income country status. Nevertheless, Peru holds vast opportunities for faster development if it can seize key strategic opportunities and address long-overdue reforms, as emphasized in the Country Economic Memorandum (World Bank, 2025a).
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“World Bank. 2025. Peru Public Finance Review: Mobilizing Resources for Service Delivery and Growth. © World Bank. http://hdl.handle.net/10986/44070 License: CC BY-NC 3.0 IGO.”
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