The economic impact from Covid-19 has been brutal. Many families have fallen into pockets of poverty and some have fallen behind, thus burying all those sacrifices across the generations to move forward. The Institute of Peruvian Economics (IPE) estimates that poverty reduction from 2022 to 2019 levels will take nearly three decades if economic growth stagnates at 2%.
According to official information, the poverty rate in Peru increased to 27.5% in 2022, after temporarily declining to 25.9% in 2021. This rise occurs in the context of low economic growth and high inflationary pressures that have affected more low-income households in the regions Urban area.
In this sense, Transparency International indicates that poverty is still higher than the rates reached before the pandemic, reaching levels similar to those recorded in Peru in 2011. In this sense, 2 million 690 thousand people fell into poverty since 2019.
The bluntness of the report is a reflection, cold, of what is perceived in reality, as more and more businesses close their premises, more and more Peruvians do not make it to the month with the salary they receive, or simply cannot complete the purchased foods that make up the basic family basket. The situation on the field is much the same as in the city.
The recovery of living conditions is still slower and more incomplete in urban areas. While poverty in rural areas remained at levels close to 2019 levels (41%), poverty in urban areas increased to 24% in 2022, a rate that is not only 9 percentage points higher than that recorded before the pandemic, but rather represents a reversal of poverty. levels 14 years ago.
Thus, the economic entity explains, poverty has been reconfigured as a phenomenon which is now concentrated mainly in the urban area. The capital, Lima, for example, has gone from a concentration of 23% of the poor population in 2019 to 33% in 2022.
Looking beyond urban boundaries, when disaggregating the results at the regional level, it was noted that poverty in 15 of the 25 regions of Peru had increased compared to 2021. In regions such as Huanuco, Madre de Dios, Tumbes and Ucayali, for example, rates increased. poverty by about 6 percentage points on average during 2022.
Conversely, the regions where poverty declined the most were the provinces of Junín, Huancavelica, Apurímac and Lima. A related case is that of Metropolitan Lima, where poverty increased to 27.3% in 2022, a rate similar to that which increased in 2020 as a result of the pandemic (27.5%).
Analysis of the results by socioeconomic levels, according to the definition of the World Bank, shows that the percentage of people belonging to the middle class reached 32.8% in 2022, which is a lower number than the levels reached in 2019 (40.0%).
This means that nearly 2 million people have not yet returned to the middle class after the effects of the pandemic in 2020. Meanwhile, the population at risk increased from 35.2% to 38.5% in the same period.
The institute indicated that the return of poverty to what was recorded in 2019 requires greater economic growth to generate better job opportunities and higher incomes, especially in the regions of the country that witnessed the largest decline in their living conditions in recent years.
If Peru stagnates at GDP growth rates of 2.0% annually, the Institute of Peruvian Economics (IPE) estimates that from 2022 it will take nearly three decades for poverty rates to return to pre-pandemic levels.
Promoting growth must be accompanied by reshaping social protection strategies in urban areas and improving the quality of public services in rural areas, which is also essential to have authorities and civil service capable of doing so.
[11:42, 13/5/2023] Judith Pons: Note 2
The Productive Route Exporter program adds value to the produce of farm families
Many farming families have benefited from the government’s initiative through the Route of Productive Export (RPE). Thus, the aforementioned program succeeded in benefiting a total of 10,453 households linked to the value chain of bananas, coffee and cocoa, in the regions of Piura, San Martin and Junín.
The announcement was made by the Minister of Foreign Trade and Tourism, Juan Carlos Mathews, who confirmed that the Route of Productive Export (RPE) is having a positive impact on Peruvian households. These pilot projects involved 150 organizations including producer associations, cooperatives and exporting companies with export potential. We want them all to embody their export interest, and we have shown that successful results can be obtained through coordinated multisectoral action,” said Minister Matthews.
The program will be expanded, in addition to the coffee, cocoa and banana chains, to mango and Andean beans. This month, RPE will start placing applications in the regions of Cajamarca, Huánuco, Lambayeque, Amazonas, Cusco and Puno, from which more than 300 institutions and companies are expected to benefit.
It should be noted that RPE seeks to enhance the competitiveness and internationalization of exporting micro, small and medium enterprises and those with export potential, by providing more efficient productivity development services, provided by three government sectors, and their affiliated entities.
The pilot projects were implemented with co-financing from the SeCompetitivo Program of the Swiss Cooperation – SECO and Helvetas Peru. It has also been supported by Midagri, PromPerú, Sierra y Selva Exportadora, Technological Institute of Production, National Institute of Agricultural Innovation and DIVIDA.
In the Piura region there are 42 organizations accepted into the RPE: 40% are exporters and 60% are potential exporters. There, 46 services are programmed and implemented exclusively in the banana chain.
In this way, ten organizations in the region were able to export to new markets such as Belgium, Sweden, Italy, Panama, South Korea, the United States, Colombia, Finland, France, Guatemala and Hong Kong. In addition, five MSMEs were able to make their first shipments after accessing the program.
In the Junín region, on the other hand, there are 55 recognized organizations: 49 operating in the coffee chain and 6 participating in the cocoa chain. 44% of the total are export organizations and 56% are potential exporters.
Through RPE, six organizations in this region have been able to export coffee to countries such as Canada, Denmark, Italy, Belgium, the Netherlands and the United Kingdom; and three were allowed to make their first international sales. In this way, 3,562 households in the region were able to benefit from the outreach strategy.
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