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Peru raises cost of post-floods rebuilding to nearly $8 bln
September 6, 2017 / 10:04 PM / 3 months ago

Peru raises cost of post-floods rebuilding to nearly $8 bln

LIMA, Sept 6 (Reuters) - Previously uncalculated damage caused by severe flooding in Peru this year has pushed up the cost of rebuilding infrastructure by 28 percent to 25.65 billion soles ($7.92 billion), a government official said Wednesday.

Pablo de la Flor, who was appointed by President Pedro Pablo Kuczynski to lead the reconstruction effort, said 38 percent of the new total will pay for rebuilding highways, roads and bridges. The rest will be used to help build homes, schools, health clinics, sewage systems and farms affected by the floods.

“Without a doubt this is the most important fiscal effort in Peru’s recent history,” de la Flor told a press conference.

Finance Minister Fernando Zavala said the cost increase would be included in the budget in 2019 or 2020.

The rebuilding plan was approved by Kuczynski’s cabinet on Wednesday and does not need a green light from Congress.

Early this year an unusually brutal rainy season due to a sudden warming of Pacific waters killed 162 people, slowed economic growth sharply and caused damage equivalent to 2 percent of Peru’s gross domestic product.

De la Flor said the government would likely start awarding contracts at the end of the year.

$1=3.237 Reporting by Marco Aquino; Writing by Mitra Taj; Editing by James Dalgleish

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