Peru, cutting subsidies, ups food and fuel prices

Peruvian government increased the price of fuel and basic foodstuffs by an average 48 percent as part of a policy to eliminate subsidies. Gasoline went up by 29 percent, although Peru exports oil. Other increases covered the price of gas and electricity and the cost of staple foods such as bread, rice, milk, and sugar.

Prime Minister Manuel Ulloa said the food and gasoline subsidies would have cost almost $900 million this year. He said the government would continue to subsidize some products and would adopt a system of food co upons for the poorest classes.