LatinNews Daily - 28 August 2024

*The executive board of Peru’s state oil company, Petroperú, has released a statement saying that the government should consider allowing the company to go bankrupt if it is unwilling to make major structural changes to Petroperú, including its privatisation. Petroperú had previously asked in May to be placed under private management, arguing that it would be “immoral” to request further financial bailouts from the government. In its most recent statement, the company said that there are three options for President Dina Boluarte’s government, which is Petroperú’s sole shareholder. The first option, which has been the government’s approach so far, would be to “continue injecting capital into the company… without requesting or ensuring credible organisational changes to boost efficiency”. The other two options would be to “accept its bankruptcy/liquidation” or to “opt for a profound and credible restructuring” with the support of “a company with proven international experience”. This, the company said, would involve “attracting private capital to Petroperú”. Petroperú blamed three factors for its dire financial situation: “a history of political and trade union interference” that it said had harmed efficiency, transparency, and good corporate governance; the construction of the company’s new Talara refinery, which cost double the anticipated budget; and the subsequent need for the company to take on more debt.