UPDATE 2-Peru sees deficit rising to 2 pct of GDP on stimulus measures
(Adds details, context, quote from analyst)
By Mitra Taj
LIMA, April 30 (Reuters) - Peru's budget deficit will rise to 2 percent of gross domestic product this year as the government boosts spending and cuts taxes to try to jump-start sluggish economic growth, the finance ministry said on Thursday.
The finance ministry had forecast a deficit of 0.4 percent of GDP in its last macroeconomic report in August before the government began rolling out additional measures to counter a sharp economic slowdown.
Peru posted a 0.2 percent deficit last year as its mining-fueled economy slowed to its weakest growth rate in five years, 2.35 percent, amid a drop in metals exports and investments.
The ministry expects the economy to perk up, growing between 3.5 and 4.5 percent this year and 5.5 percent in 2016.
Finance Minister Alonso Segura has said the economy will likely grow by around 4 percent in 2015 with a downward bias.
On Wednesday, the government of President Ollanta Humala announced new stimulus measures valued at about 5 billion soles ($1.6 billion), including import-duty cuts and an extension of consumer incentives.
The policies, some of which must be approved by a fragmented congress, build on previous efforts to encourage growth by cutting taxes, investing in infrastructure projects and reducing red tape. Continuación...