Fitch: New MEF head to maintain positive economic policies

Ratings agency Fitch is expecting Peru’s new Economy and Finance minister (MEF), Ismael Benavides, to maintain the country’s positive economic policies, state news agency Andina reported.

“In Peru there are always cabinet changes more often than in other countries, and Benavides is not going to change the macroeconomic or fiscal policy of the country,” said Theresa Paiz, the agency’s director of sovereign ratings for Latin America.

Benavides was sworn in as Peru’s Economy and Finance minister on Tuesday during a Cabinet shuffle by President Alan Garcia. He replaces Mercedes Araoz.

In June, Fitch revised its positive credit rating outlook for Peru to positive from stable.

Meanwhile, Paiz agreed with the World Bank and other international organizations that expect Peru’s economic growth to lead Latin America this year. Government revisions projecting growth of 6.8 percent is not unreasonable, Paiz said.

“As a rating agency we always have more conservative projections, but we think it is reasonable the new estimates from the Economy and Finance Ministry and the Central Bank about GDP expansion this year,” she said.

Peru’s economy expanded for the 12 month in a row in July, the national statistics and technology bureau INEI reported on Wednesday.

In July, the GDP grew by 9.05 percent compared to the same month in 2009.

The manufacturing sector expanded 17.24 percent, while construction was up 12.33 percent. Financial and insurance sector was up 12.08 percent, electricity and water sector grew 10.65 percent, hotel and restaurant sector up 9.11 percent and transportation and communications grew 6.65 percent.

The agriculture sector was up 3.58 percent, while the mining and hydrocarbon sector grew 0.64 percent and fishing sector declined 14.57 percent.

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