LIMA, March 20 (Reuters) - Peru’s finance minister, Alonso Segura, said on Friday that another annual drop in private investment this year could drag down economic growth in the global minerals exporter to below 4 percent.
The government of President Ollanta Humala is ramping up spending to help encourage a 2015 economic expansion that will top 4 percent, Segura said.
“We’re going to be above 4 percent with private investment flat and below 4 percent with negative private investment,” Segura said during a presentation at a business event.
Last year both private and public investments slipped, by 1.6 percent and 3.6 percent, respectively, as mining projects and local government contracts stalled, according to the central bank.
Segura said he now expects growth of 4.2 percent in 2015, echoing a forecast made by another official in his ministry earlier this month.
The government previously had a 4.8 percent growth target for this year, which would have marked a strong rise from last year’s 2.35 percent rate, the slowest since 2009.
Peru’s economy has slowed sharply over the past year on tumbling mineral exports. Growth has yet to show signs of a strong recovery, leading the central bank and Finance Ministry to repeatedly revise down their forecasts.
Last week the central bank said the economy was not rebounding as quickly as expected because of a steep drop in investments by local governments, which are in transition following elections late last year.
Reporting by Marco Aquino; Writing by Mitra Taj; Editing by Leslie Adler