Peru's next economy chief says goal is 6 percent growth

Reuters News
Posted: Jul 23, 2011 11:48 AM

LIMA (Reuters) - Peru's leftist President-elect, Ollanta Humala, aims to keep economic growth rates above 6 percent and reduce poverty by reforming social programs, the incoming finance minister said on Saturday.

Humala, who takes office in five days, has sought to convince investors he will soundly manage the Andean country's fast-growing economy following market volatility since his July 5 election victory.

"The aim is maintaining growth of more than 6 percent to reduce poverty and, at the same time, have a much more active role in social programs," future finance minister Luis Castilla was quoted as saying by newspaper El Comercio.

Castilla, an orthodox economist who until Friday was deputy finance minister, is associated with the free-market boom of recent years, which relied heavily on foreign investment and which Humala has criticized for failing to combat poverty.

"The key is to restore investor confidence and work actively to have well-designed social programs that are adequately financed, and that's what we're working on," Castilla said.

Peru's economy surged nearly 9 percent last year and is on track to grow 6 percent this year on a recipe of free-trade, open markets and foreign investment, but critics accuse the outgoing government of failing to spend enough on welfare.

Despite a decade-long economic boom, a third of Peruvians are still stuck in poverty.

(Reporting by Teresa Cespedes; Writing by Helen Popper; Editing by Todd Eastham)