Three key challenges for Peru’s next president

While the latest polls suggest that the race for Peru’s presidency remains open, a highly fragmented legislature looks the most likely outcome whoever wins. Navigating a divided congress will be a key constraint on the next president, making fiscal consolidation and the structural reforms needed to lift Peru’s productive capacity slow and difficult. That supports our view that the economy is unlikely to expand by close to the 3% pace envisaged by the consensus over the coming years.