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Peru’s Self-Sabotage

SAN MARCOS – You may know Peru as the cradle of Incan civilization. Or you may have tasted its outstanding cuisine. But Peru boasts another impressive characteristic: it is among Latin America’s fastest-growing economies, with GDP up by 4.8% year on year in the first quarter of 2014. Peru’s long-term prosperity, however, is far from certain.

In fact, Peru’s economic growth – which is based largely on exports of raw materials and hydrocarbons – is already slowing, from annual rates of 5.5-6.9% over the last three years. And, though the government recognizes the need for growth-enhancing reform, its approach is all wrong.