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Peru's public finances: the budget cycle, the 2026 budget and 2027 bill, borrowing limits and public debt

Last verified: 2026-10-28 · Status: Changing

Peru's budget is a yearly law: the Executive sends the Budget, Borrowing and Financial Balance bills to Congress by 30 August, and if Congress has not sent the budget back by 30 November the Executive's bill takes effect by legislative decree. The 2026 budget (Ley Nº 32513) is S/ 257,562 million, about US$74.6 billion, and the 2027 bill sent in August 2026 is S/ 266,506 million, of which 37.5 percent goes to regional and local governments. Public debt is projected at 29.3 percent of GDP in 2026 and 2027, well inside the 38 percent transition ceiling, and new borrowing is capped each year by a separate law: for 2026, US$2,840 million abroad and S/ 38,435 million at home.

USD figures use S/ 3.452 per US dollar, the banking system selling rate published by the Superintendencia de Banca, Seguros y AFP for 27 October 2026 (BCRP series PD04640PD), the latest value available on the verification date. Borrowing caps set in US dollars are quoted as legislated. Conversions are for orientation only.

Key facts

Approved budget, 2026 (Ley Nº 32513)	257561619143 PENLey Nº 32513 art. 1, as of 2025-12-04 · in force
Budget Bill, 2027 (pending in Congress)	266506000000 PENProyecto de Ley de Presupuesto 2027, as of 2026-08-30 · pending
Growth of the 2027 Budget Bill over the 2026 budget law (nominal, computed)	3.5 %Proyecto de Ley de Presupuesto 2027 vs Ley Nº 32513, as of 2026-08-30 · pending
Share of regional and local governments in the 2027 Budget Bill	37.5 %Proyecto de Ley de Presupuesto 2027, as of 2026-08-30 · pending
Debt service share of the 2027 Budget Bill	11.7 %Proyecto de Ley de Presupuesto 2027, as of 2026-08-30 · pending
External borrowing cap, 2026	2840000000 USDLey Nº 32515 art. 3.1, as of 2025-12-04 · in force
Internal borrowing cap, 2026	38435000000 PENLey Nº 32515 art. 3.2, as of 2025-12-04 · in force
Internal borrowing cap proposed for 2027	19184000000 PENProyecto de Ley de Endeudamiento 2027, as of 2026-08-30 · pending
External borrowing cap proposed for 2027	2800000000 USDProyecto de Ley de Endeudamiento 2027, as of 2026-08-30 · pending
Non financial public sector gross debt, 2026 projection	29.3 % of GDPMEF statement of reasons, 2027 Budget Bill, as of 2026-08-30 · in force
Gross debt ceiling during the transition	38 % of GDPDecreto Legislativo Nº 1621 art. 3, as of 2024-07-08 · in force
Deadline for the Executive to send the Budget Bill	30 August dateConstitución art. 78, as of 2026-10-28 · in force
Deadline for Congress to send the approved budget (otherwise the bill takes effect by legislative decree)	30 November dateConstitución art. 80, as of 2026-10-28 · in force
Vote needed for a special tax regime for one zone	Two thirds of the legal members of each chamber ruleConstitución art. 79 as amended by Ley Nº 31988, as of 2026-10-28 · in force

The rule

1. The economic and financial administration of the State is governed by the budget Congress approves each year, with two sections: the Central Government and decentralised bodies. The President sends the Budget Bill to Congress by 30 August each year, together with the borrowing and financial balance bills. The budget must be effectively balanced, loans from the BCRP or Banco de la Nación do not count as fiscal revenue, permanent spending may not be financed with borrowing, and no budget may be approved without an allocation for public debt service. Under the bicameral Constitution the Budget Bill is studied by a bicameral committee with equal numbers of senators and deputies and voted by Congress.Constitución Política del Perú de 1993, art. 77; art. 78 as amended by Ley Nº 31988, Art. 77 and art. 78, 1993-12-30 official text · verified 2026-10-28

2. The Minister of Economy and Finance presents the revenue side before the Chamber of Deputies and the Senate meeting together as Congress, and each minister defends the spending of their sector. If the approved budget is not sent to the Executive by 30 November, the Executive's bill takes effect and is promulgated by legislative decree. Supplementary credits and transfers between budget lines follow the same route as the Budget Law. Members of Congress cannot create or increase public spending except in Congress's own budget, laws granting tax benefits or exemptions need a prior MEF report, and a special tax regime for a given zone needs a law approved by two thirds of the legal members of each chamber.Constitución Política del Perú de 1993, art. 79 and art. 80 as amended by Ley Nº 31988, Art. 79 and art. 80, 2024-03-20 official text · verified 2026-10-28

3. The General Account of the Republic (the executed budget), with the Comptroller General's audit report, goes to Congress by 15 August of the following year. A bicameral committee reports on it by 15 October and Congress decides by 30 November; failing that, the Executive promulgates it by legislative decree. The Comptroller General supervises the legality of budget execution and of public debt operations.Constitución Política del Perú de 1993, art. 81 and art. 82 as amended by Ley Nº 31988, Art. 81 and art. 82, 2024-03-20 official text · verified 2026-10-28

4. The 2026 Budget Law approves total spending authority of S/ 257,561,619,143 for the national government, regional governments and local governments. The national government share is S/ 162,305,205,072, of which S/ 103,004,886,688 is current spending, S/ 27,817,177,563 capital spending and S/ 31,483,140,821 debt service; regional governments receive S/ 59,460,754,465 and local governments S/ 35,795,659,606.
Cost to do it: Total 2026 spending authority S/ 257,562 million, about US$74,612 million.
Example: S/ 257,561,619,143 / About US$74.6 billionLey Nº 32513, Ley de Presupuesto del Sector Público para el Año Fiscal 2026, El Peruano 4 December 2025, Art. 1, 2025-12-04 official text · verified 2026-10-28

5. The 2026 Borrowing Law authorises the national government to contract external debt up to US$2,840,000,000 (up to US$1,840,000,000 for economic and social sectors and up to US$1,000,000,000 for balance of payments support) and internal debt up to S/ 38,435,000,000, including up to S/ 7,923,000,000 for national defence. It also caps national government guarantees for public private partnership processes at US$631,410,502.
Cost to do it: Internal borrowing cap S/ 38,435 million, about US$11,134 million; external cap US$2,840 million.Ley Nº 32515, Ley de Endeudamiento del Sector Público para el Año Fiscal 2026, Art. 3, 2025-12-04 official text · verified 2026-10-28

6. The 2027 Budget Bill sent to Congress in August 2026 totals S/ 266,506 million: S/ 166,613 million (62.5 percent) for the national government, S/ 58,672 million (22.0 percent) for regional governments and S/ 41,222 million (15.5 percent) for local governments. By use, S/ 170,196 million is current spending, S/ 55,488 million capital spending (S/ 57,143 million with the contingency reserve) and S/ 31,221 million (11.7 percent) debt service. Ordinary revenue funds S/ 167,837 million and borrowing S/ 24,436 million. The bill is pending in Congress, which must return it by 30 November 2026.
Cost to do it: S/ 266,506 million, about US$77,203 million.
Example: S/ 266,506 million / About US$77.2 billionProyecto de Ley de Presupuesto del Sector Público para el Año Fiscal 2027, MEF statement of reasons, Sections 1.1, 1.2.1 and 1.5.1.2, 2026-08-30 official text · verified 2026-10-28 · changed: Pending: the 2027 Budget Bill was sent in August 2026 and must be approved by Congress by 30 November 2026 (Constitution art. 80). On 22 October 2026 the Executive announced that changing the fiscal rules from 2027 would add S/ 18,000 million (about US$5.2 billion) to the 2027 budget; that change needs a law.

7. The 2027 Borrowing Bill proposes external borrowing up to US$2,800 million and internal borrowing up to S/ 19,184 million, mainly through sovereign bonds in soles at fixed rates (about S/ 17,221 million). The MEF projects financing needs of the non financial public sector at 2.4 percent of GDP on average for 2026 to 2029, funded mostly in local currency. The bill is framed by Decreto Legislativo Nº 1437, whose art. 9 says the yearly borrowing law sets the maximum amount and general purpose of borrowing and the cap on guarantees for public private partnerships.Proyecto de Ley de Endeudamiento del Sector Público para el Año Fiscal 2027, MEF statement of reasons; Decreto Legislativo Nº 1437 art. 9, Sections 6.2 and IV; art. 3 of the bill, 2026-08-30 official text · verified 2026-10-28 · changed: Pending in Congress together with the 2027 Budget Bill.

8. Under the fiscal rule transition path, non financial public sector gross debt may not exceed 38 percent of GDP from 2024 and must be at or below 30 percent of GDP by 2035, and the deficit ceiling is 1.8 percent of GDP in 2026 and 1.4 percent in 2027. The MEF projects public debt at 29.3 percent of GDP in 2026 and 2027, against 72.6 percent for the Latin American average and 77.2 percent for emerging economies, and a 2026 deficit of 1.8 percent of GDP. On 22 October 2026 the Executive announced a bill to raise the 2027 deficit ceiling to 2.4 percent of GDP, converging to 1 percent by 2031; it is not law yet.Decreto Legislativo Nº 1621 art. 2 and art. 3; MEF statement of reasons for the 2027 Budget Bill, DL 1621 art. 2 and art. 3; statement of reasons section 1.2, 2024-07-08 official text · verified 2026-10-28 · changed: Pending: MEF announcement of 22 October 2026 of a bill raising the 2027 deficit ceiling from 1.4 to 2.4 percent of GDP.

9. The State guarantees payment only of public debt contracted by constitutional governments in line with the Constitution and the law. Domestic and foreign borrowing by the State is approved by law, and municipalities may borrow against their own resources and assets without legal authorisation. Congress authorises loans in line with the Constitution.Constitución Política del Perú de 1993, art. 75; art. 102 Nº 4 as amended by Ley Nº 31988, Art. 75 and art. 102 Nº 4, 1993-12-30 official text · verified 2026-10-28

Level	2026 (Ley Nº 32513)	2027 Bill	2027 share	2027 in US$ million
National government	162,305	166,613	62.5%	48,266
Regional governments	59,461	58,672	22.0%	16,997
Local governments	35,796	41,222	15.5%	11,942
Total	257,562	266,506	100%	77,203

2026 budget law and 2027 Budget Bill by level of government, S/ million. USD at S/ 3.452 (SBS selling rate, 27 October 2026), for orientation only.

Item	National	Regional	Local	Total
Current spending	103,026	45,879	21,291	170,196
Capital spending	24,606	12,458	18,424	55,488
Debt service	29,380	334	1,507	31,221
Contingency reserve	9,601			9,601
Total	166,613	58,672	41,222	266,506

2027 Budget Bill by type of spending, S/ million (MEF statement of reasons).

Cap	2026 (Ley Nº 32515)	2027 (bill, pending)
External borrowing	US$2,840 million	US$2,800 million
Internal borrowing	S/ 38,435 million	S/ 19,184 million
PPP guarantees	US$631 million	Set in the bill

Yearly borrowing caps: 2026 law and 2027 bill.

Worked example

Budget scale. The 2027 Budget Bill of S/ 266,506 million is about US$77.2 billion; its S/ 31,221 million debt service line (about US$9.0 billion) is 11.7 percent of the total, and capital spending of S/ 55,488 million (about US$16.1 billion) is the pool that funds the public works contractors bid for.
Who pays for a regional project. A road in a mining region can be funded by the national government, by the regional government's own budget (S/ 58,672 million in the 2027 bill) or by local governments' canon and FONCOMUN money, which is earmarked mostly for investment; see macro/regions-canon-and-decentralization.

Step by step

1. Each 30 August, read the Budget and Borrowing bills and their MEF statements of reasons; they show spending by sector and level of government and the debt plan (Constitution art. 78).
2. Check the final Budget Law published in El Peruano in late November or early December; Ley Nº 32513 for 2026 was published on 4 December 2025.
3. If you sell to the State, follow the capital spending lines and procurement thresholds in the Budget Law, and check which level of government holds the budget for your project.
4. Follow the bill raising the 2027 deficit ceiling, announced on 22 October 2026, through Congress; see start/reform-tracker.
5. Put 30 August (bills), 30 November (budget approval) and 15 August (General Account) in your calendar; see /calendar/.

Common traps

Reading the budget bill as the budget. The 2027 numbers are a proposal until Congress approves them; only if Congress misses 30 November does the Executive's bill take effect as is (art. 80).
Assuming Congress can add spending for your project. Members of Congress have no initiative to create or increase spending (art. 79).
Mixing debt measures. The 29.3 percent of GDP figure is the MEF projection for non financial public sector gross debt; the 38 percent ceiling and the 30 percent medium term anchor apply to the same measure.
Ignoring the borrowing law when dealing with State guarantees. PPP guarantees with multilaterals are capped each year by the borrowing law (US$631 million in 2026).

Sources

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