Living in Peru, it can be tough to remember that much of the West is facing economic turmoil unlike anyone under the age of 80 has ever seen. The news of the world looks grim: Unemployment remains at staggering highs in the U.S., a few of the major economies of Europe face the very real possibility of default and serious economists speak in hushed tones about the possibility of a double-dip recession.
But in the midst of all this despair, it’s boom times here in Peru. The country is going through a historic growth spurt. In the last decade, its economy has nearly tripled in size, ballooning from a GDP of around $50 billion in 2001 to more than $150 billion today.
Yes, the good times are rolling in Peru, and the evidence is everywhere you look. A quick scan of the Lima skyline reveals dozens of buildings under construction; So many that cranes and construction crews can barely keep up. A particularly telling headline in Lima’s El Comercio newspaper asked not how the country should brace for the effects of S&P’s recent downgrade of the United States’ debt, but how its central bank could take advantage of this news, raising Peru’s global profile and credit rating. Even in the midst of global uncertainty, Peru remains brashly confident about its future prospects.
The evidence of this is even more pronounced among Peruvians themselves — especially the young. The 20-something Peruvians I’ve met all seem to be preparing for, or are in the midst of, shining careers in fields like economics, tourism and finance. They project an easy confidence about their futures, something you simply don’t see in young people back home. Many of my friends are simply trying to find a job that will pay the rent, or are entering grad school in the hope things will be better when they come out. I was with them, until I decided to pack my bags and come down here.
But even with its economy surging ahead, Peru still suffers from grinding poverty. More than 30 percent of the country’s population is considered poor by the Peruvian government, and just over seven percent face extreme poverty, with incomes less than $1 a day. As with much of Latin America, Peru has some of the highest income inequality in the world, a legacy of Spanish colonialism and the divisions between whites and indigenous peoples that carry on to this day. That widening disparity has left its mark on the landscape, with shantytowns existing just blocks away from modern high rises.
So what does the future hold for Peru? As with the world at large, nobody can know for sure. One thing that is clear is that the economic engine is humming along here and throughout much of the developing world, while it’s sputtering to a standstill up north. Whether fast-growing countries like Peru, Brazil and China can drive us to a global recovery is a question for another day.