Peru finance minister predicts 9 pct growth for 2011

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Andina

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Lima’s financial district. (Photo: Victor Palomino/Andina)

Finance Minister Ismael Benavides said Peru’s economy will grow as much as nine percent by the end of this year on the back of strong GDP expansion in recent months.

"I would like nine percent and evidently there are indicators of this high growth, especially in October, November and December," he said.

In an interview with TV Peru on Monday, he said positive indicators included cement production and electricity consumption levels, which will lead to a higher-than-expected GDP growth this year.

"This is a strong recovery from last year’s slowdown and puts Peru on the path of growth so as to reduce poverty and improve the people’s income and livelihood," Benavides said.

The minister added that there was room for more growth in Peru, but warned, however, of future "bottlenecks" to expansion, including a shortage of "human capital" such as technically qualified professionals, poverty levels and infrastructure shortages. Benavides said Peru needed to prepare to grow at rates of more than 7% to overcome these problems.

Earlier this month Benavides said he believed Peru’s GDP in 2010 could grow between 8.7% and 9%.

According to the Latin American Consensus Forecast, the Peruvian economy will expand by 8.5% this year and 6% in 2011, up from prior estimates of 7.9 percent and 5.8%, respectively.

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