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Mercados

Copper giant Peru enters recession after economy contracts 30.2% in Q2

LIMA, Aug 20 (Reuters) - Copper-rich Peru’s economy contracted by 30.2% between April and June, the government said on Thursday, representing a second consecutive quarter in the red and taking it into technical recession.

The announcement comes as Peru, the world’s second-biggest producer of the red metal, struggles to overcome one of the region’s worst outbreaks of the novel coronavirus and its economy reels from the impact of a strict lockdown.

In the first quarter of the year, Peru’s economy contracted 3.5%, according to a report by the National Institute of Statistics and Information (INEI).

The more drastic decline in the second quarter is explained “by the decrease in domestic demand (-27.7%), and the negative behavior of our exports (-40.3%),” the INEI said in a statement.

Peru was one of the first in Latin America to impose a quarantine in mid-March to curb the pandemic. Since May, it has started to lift restrictions in most regions in a bid to reactivate the economy that, according to the central bank, will contract 12.5% this year.

The halt of all productive activity, with the exception of essential food, medical and financial services, has also seen some 6.7 million jobs lost nationwide between April and June, INEI said.

Coronavirus cases in Peru rose to 558,420 on Wednesday - almost double the number reported on June 29, a figure that places the Andean country as the second most infected in Latin America after Brazil, according to a Reuters tally. A total of 26,834 people have died so far.

Reporting by Marco Aquino, writing by Aislinn Laing Editing by Nick Zieminski

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