The proposals put forward by the Executive to carry out a judicial and political reform will be positive to attract investments and favor an improvement in the credit rating of Peru, said Jaime Reusche, vice president of the Moody’s Investors Service Group.
“The reforms would have an important effect for investments that support gross capital formation, rather than for financial ones since that type of capital prefers greater long-term security,” Reusche said in an interview with El Peruano, according to El Comercio.
He considered that although the reforms “are a step in the right direction”, its implementation and enforcing the law is a process that has to be continuous and that will take several years.
On the other hand, Reusche said that the strengthening of institutions in Peru would allow the country to have a better credit rating to be at the level of Chile, which has an “A1” grade.
Currently, Peru’s rating is of A3, in part for the weak political institutions in the country. “Corruption, weakness of the judicial system, bureaucratic obstacles, low levels of education, the high levels of informality, the low respect for the rule of law and contracts, the little commitment of the political class to adopt structural reforms and others”, according to El Comercio.