20090317 – Peru economy slows, growing by 3.1 pct in January
Peru’s boom sputtering? Economic growth slows to 3.1 pct in January
By ANDREW WHALEN
Associated Press Writer
LIMA, Peru (AP) _ Peru posted its lowest economic growth rate in years on Monday, saying it expanded by just 3.1 percent year-to-year in January amid signs that a three-year economic boom fueled by soaring metals prices could be sputtering.
The Andean nation’s economy grew by 9.8 percent last year, faster than China’s, but has slowed as the global financial crisis drives down prices and demand for its main mineral exports.
Peru’s statistics institute reported Monday that the economy grew by 3.1 percent in January over the same period a year earlier, the lowest monthly rate of President Alan Garcia’s term, which began in 2006.
The report said exports fell 38.6 percent in January over the same period the year before.
The government is projecting 5 percent growth in 2009, which would be one of the highest in the world amid the global downturn. But analysts are already questioning the figure.
The government is implementing a $3 billion anti-crisis package aimed at infrastructure and public works to combat the effects of falling export prices.
The former head of the statistics institute, Farid Matuk, says the formal growth figure only represents reality for Peru’s upper crust. Despite soaring commodity prices that prompted growth rates of 8 percent in 2006, 8.9 percent in 2007 and 9.8 percent in 2008, job growth in Peru as a whole was stagnant, Matuk said.
Monday’s report said that overall employment from December 2008 through February 2009 fell by 0.7 percent in metropolitan Lima compared to the same period the year before, although it said that formal sector employment grew by 5.1 percent.
Matuk said statistics institute figures show that the number of employed Peruvians in metropolitan Lima who lack a college education has actually fallen by 3 percent since February 2007.
“In the past two years there have not been substantial improvements in household living standards and employment is basically stagnant because growth has been based on raw materials” like mining and other non-labor intensive industries, Matuk told the Associated Press.