Peru is an emerging economy facing the considerable challenge of diversification due to its significant reliance on commodity exports. The country's credit profile is bolstered by a moderate debt load, limited fiscal vulnerabilities, and a history of stable regulatory framework. Its external position remains healthy, supported by steady FDI flows and adequate forex reserve levels. However, political instability and governance issues significantly undermine Peru's creditworthiness. Issues such as frequent changes in the presidency, political fragmentation, corruption scandals, and civil unrest have eroded institutional stability.