Peru Sees Metal Export Revenue Falling on Slower Global Growth
Peru, the world’s third-biggest copper producer, will see a drop in export revenue as metal prices decline on slower global growth, Finance Minister Miguel Castilla said.
“We’re entering a period of reduced global demand because the world is going to grow more slowly,” Castilla said in an interview with Lima-based Canal N. “That’s going to result in a decline in the price of our raw materials.”
Commodities led by metals and natural gas account for three quarters of Peru’s exports, which rose to a record in May on higher prices for copper and gold. The Andean country’s mining industry accounted for 27 percent of the government’s total tax take in 2009.
Castilla said the government’s should draw up a “conservative” budget for next year given the greater risk of a recession in the U.S., Peru’s top export market.
“It’s better to err on the side of caution than go for a more expansive policy and then prices fall and we’re unable to finance our budget,” he said.
The $153 billion economy will expand by 6 percent to 6.5 percent this year, after growing 7.7 percent in the first half, Castilla said.
The sol strengthened 0.2 percent to 2.7467 per dollar at 10:50 a.m. New York time from 2.7515 yesterday.
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