Peru had the second-lowest country risk in Latin America at the close of 2025. It had a value of 124 basis points, well below the regional average. This is due to the confidence that it has generated among investors. In 2025, Peru demonstrated its economic solidity and financial stability in international markets. According to data released by the Central Reserve Bank of Peru (BCRP), the country maintained a very low country risk level at the end of the year, measured by the EMBIG (Emerging Market Bond Index Global) indicator, remaining the second-lowest risk economy in Latin America after Chile.
This performance is the result not only of a favorable market perception but also of the prudent conduct of macroeconomic policies that Peru has maintained for years. Fiscal discipline, conservative debt management, and the low inflationary performance have positioned Peru as a market with an investment-grade perception among international credit rating agencies. In this sense, the commitment to structural reforms and incentives for private investment has further strengthened the country’s solidity even in periods of regional uncertainty.
This has also reinforced the image of macroeconomic solidity and fiscal responsibility that Peru has been building in recent years, despite being located in a region that has experienced episodes of volatility and financial uncertainty. In this context, Peru has emerged as a highly attractive option for investors seeking stable, predictable returns when considering investment projects in Latin America.
A historical trend that consolidates trust
The EMBIG indicator, which reflects the spread between the returns of Peruvian sovereign bonds and US Treasury bonds, showed a positive evolution throughout the year. While at the end of December 2023, the country risk was at 162 basis points, at the time of closing on December 22 of 2025 it had decreased to 124 basis points. This annual variation of 31 basis points shows a trend of improvement in the perception of international investors regarding the country’s ability to meet its obligations and the prudent management of its macroeconomic variables.
The practical impact of this situation is that Peru finds itself in a better position to access external financing and make itself more attractive for foreign investment. When deciding where to direct their business expansion strategies in Latin America, many companies take into account the country risk of the different economies. By being among the countries with the lowest country risk in Latin America, Peru now enjoys lower costs for new financing, better conditions for its credit lines, and greater confidence in the continuity and stability of fiscal and regulatory policies.
In addition, this situation is the result of the convergence of various favorable factors. Peru has been able to maintain a relatively low level of public debt in relation to GDP compared to other regional economies, and through interventions of its central bank, it has also achieved an inflation performance within the targeted ranges. Furthermore, the accumulation of comfortable foreign exchange reserves has allowed Peru to strengthen its protection against external shocks, which has reinforced its resilience to volatility in global financial markets. These structural advantages have enabled the country to weather external turbulence, such as variations in the prices of certain raw materials, without suffering significant impacts on its financial system.
Peru’s position in the regional landscape
Peru is well below the Latin American average. At the close of December 2025, Latin America’s EMBIG indicator was at 333 basis points, well above Peru’s, while the average for emerging economies it was at 235 basis points.
As for the most solid countries in the region, Chile topped the ranking with an indicator of 90 basis points, consolidating itself as the Latin American economy with the highest financial stability. Peru was in second place with 124 basis points, followed by Brazil with 198 and Mexico with 223. In turn, Colombia had a country risk of 275 basis points.
In contrast, in the economies with high spreads, where the indicators are above the Latin American average, the situations are more complex, due to the challenges associated with high public debts, political uncertainty or higher inflation rates. In Peru, maintaining a prudent economic policy has been a differentiating factor that has allowed it to stand out favorably with respect to its regional peers. In this way, for investors, the difference in country risk between economies like Peru or Chile and those with higher spreads in Latin America is very relevant in the decision-making process when allocating capital, large-scale investments, or financial assets in the region.
In this sense, lower-risk economies in Latin America tend to be the preferred destinations for infrastructure investments, corporate expansion, and portfolio diversification. This is due to the fact that these economies offer more stable and predictable fiscal and regulatory environments, better access to credit, and lower exposure to the fluctuations associated with political and economic volatility. For countries such as Argentina or Ecuador, which, despite having experienced significant improvements in their indicators during the year, still maintain a high level of risk. Argentina closed at 609 basis points and Ecuador at 536, well above the Pacific Alliance countries. For investors, this differential reinforces the importance of evaluating country risk in Latin America when they consider diversifying their portfolios or making investments.
Annual change and its consequences
The BCRP report indicates that most countries in the region managed to reduce their perceived risk in 2025. Peru’s 31-basis-point reduction reaffirmed its place as one of the most reliable economies in the region. Chile also reduced 28 basis points, while Mexico and Colombia decreased 91 and 48 points, respectively.
This behavior is associated with greater investor confidence, which allows economies to access external financing at more attractive rates and with lower additional costs. For countries with a country risk level similar to Peru, this context is fundamental to support their investment strategy, both public and private, as well as to improve their medium-term fiscal position. In this sense, the reduction of costs associated with external debt leaves more space for new public or private investment projects, in addition to allowing the promotion of infrastructure works, social programs, and key strategic projects for strengthening competitiveness.
In addition, the virtuous cycle that the reduction in the perceived country risk triggers also acts as an engine of economic growth. A greater inflow of foreign investment has a direct impact on GDP growth, which in turn allows for the generation of fiscal space that, when added to the reduction in the cost of external financing, contributes to further reducing country risk in Latin America. In this way, the evidence that Peru has demonstrated in 2025 serves as an example of how macroeconomic discipline and confidence in international markets can be translated into tangible benefits for public accounts and the private sector in general.
Country risk in Latin America is an important issue for any investor
In simple terms, country risk can be compared to the evaluation that a bank or financial entity will make of the financial situation of a person who seeks a loan. A borrower who has a stable income, low debt burden, and a good credit history will receive better rates and conditions. Similarly, countries with a low level of country risk, like Peru or Chile, considered economically responsible, pay lower rates on their external debt.
On the other hand, economies with greater uncertainty and instability, either politically, fiscally, or externally, have to pay higher interest rates to their creditors. This is due to the fact that investors demand greater returns as compensation for the risk of investing their money in that market. For this reason, Peru’s low risk at the end of 2025 corroborated its current position as one of the most solid and reliable economies in the region.
For any investor who is deciding between different economies and markets to deploy their financial resources in Latin America, the country risk factor must be taken into account. As mentioned before, a high-risk rating in Latin America forces an economy to have to offer greater risk premiums to its creditors, which translates into an increase in the cost of financing and new investments. Lowering the cost of capital has a direct impact on the country’s ability to carry out infrastructure projects, corporate expansion or new financial investments.
In a region that is characterized by its economic and political diversity, Peru’s commitment to building a solid and predictable investment climate has clearly differentiated it from its regional peers. As Peru continues to strengthen its position as a model of financial stability in Latin America, it will be essential to uphold the high standards that have allowed it to reach the lowest risk levels in the region. This will not only help attract high-quality foreign investment but will also have positive effects on the overall growth of the econom