Peru: construction sector could fall 8% in 2022 if resources to social housing are not improved

RIO DE JANEIRO, BRAZIL – The construction sector could grow 0.3% this year, according to the estimate of the Peruvian Chamber of Construction (Capeco). However, the guild does not rule out that the sector could register a decrease of 8% or even more in line with what other private consultants estimate.

It would be explained by the forecasts regarding public and private investment for this year, of up to -4% and -1.5%, respectively, compared to 2021, according to Apoyo Consultoría’s projections. Meanwhile, the “forecasts for 2023 are also very conservative”, said Guido Valdivia, executive director of Capeco, during the presentation of the Construction Economic Report No. 49.

SOCIAL HOUSING

One of the factors that would prevent a sharp drop in the sector for this year would be a greater placement of social housing. In 2021, even though the execution of the public budget for works reached 65% and mining investment would have rebounded to 22.5%, the second-largest placement of MiVivienda credits in the program’s history was achieved: 12,871.

“Social housing is a part of this possible growth (of the construction sector); if resources are not obtained, we will have 30% less social housing this year”, noted Valdivia.

According to Capeco, to date, PEN 1.3 billion (US$340 million) has been allocated to social housing programs (Techo Propio, MiVivienda) for 2022, a figure that is PEN 383 million less (-23%) than what was disbursed for these purposes last year.

“Because of this, it is proposed “to increase the disbursement of bonds by at least 15% compared to 2021, and that the values of the subsidies are readjusted. Thus, the new budget would be around PEN 2.5 billion, which would require an additional PEN 1.2 billion”, he pointed out.

CONFLICTS TO BE RESOLVED

In addition to this, Guido Valdivia mentioned that it would be important to promote an agreement between the Ministry of Housing, the Municipality of Lima, and some district municipalities to resolve disputes on the application of the Special Regulation on Urban Development and Buildings, in light of the recent ruling of the Constitutional Court on who should regulate zoning and land use, as well as urban and building parameters in their districts.