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LIMA, Sept 30 (Reuters) - Peru’s central bank on Tuesday widened its view of this year’s trade deficit to $3.2 billion, the global mineral exporter’s biggest shortfall in at least two decades, and trimmed the economic growth forecast to 3.5 percent.
Central Bank President Julio Velarde warned that the economy might grow less than the 6 percent now estimated for 2015 if the government does not pick up public investment and cut red tape for mining and other projects.
“These conditions are necessary to grow by 6 percent next year,” Velarde told a congressional commission. “We have everything it takes to reach that figure, but we have to act.”
President Ollanta Humala has announced several reforms - from the relaxing of environmental rules to increased public spending - to stimulate the economy, which has slowed to its weakest pace in five years.
But Humala has faced broad criticism that his government did not act quickly enough to ward off the slowdown.
Velarde said the gloomier new growth outlook for this year, revised down from a range of between 3.5 and 4 percent last week, reflects the bank’s expectation that mining and manufacturing will contract.
Together, the two sectors provide about 30 percent of gross domestic product in Peru.
The central bank expects the mining and hydrocarbon sector to fall by 1.5 percent, primary manufacturing by 2.7 percent, nonprimary manufacturing by 0.6 percent and fishing by 6.3 percent this year.
Last year Peru posted its first trade deficit in more than a decade and its first growth rate under 6 percent since 2009.
In the first seven months of 2014, Peru logged 2.98 percent economic expansion from the same period a year ago, far below the 6.4 percent average pace of the past decade.
The central bank last put this year’s trade deficit at $2.6 billion in July.
Its new estimate for this year’s shortfall would be the biggest trade deficit, according to the central bank’s online records that date to 1994.
In the first seven months of this year Peru ran a $2.6 billion trade deficit as its key mineral exports slumped on lower prices and falling gold output.
This year’s fiscal balance will likely be neutral, the central bank said, trimming its previous view of a 0.2 percent surplus.
Last year Peru posted a fiscal surplus equal to 0.9 percent of GDP.
The central bank has cut the benchmark interest rate by 0.25 basis points three times over the past year.
Reporting By Dante Alva; Editing by Meredith Mazzilli and Dan Grebler