Peru’s post-pandemic path to economic recovery will primarily require retaining confidence in prudent fiscal management and political stability, as well as addressing the structural issues impeding the country’s long-term financial sustainability. Peru has a window of opportunity to address long-term issues, but in the absence of progress, the economy is vulnerable to exogenous shocks that increase short-term risks to economic stability. Peru is a generally well-managed economy that has had strong overall growth with low inflation, and low public sector and external debt. Indeed, its reputation among international investors, including an investment-grade sovereign credit rating, is based on previous prudent fiscal management that includes a fiscal rule limiting budget deficits and low debt-to-GDP ratios. As such, under “normal” circumstances a probable post-pandemic return to positive growth would be expected to be accompanied by declining budget deficits and moderate growth in external and public sector debt.