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Economy Profile
The Republic of Peru is the third largest country in South America, after Brazil and Argentina. It is located in western South America on the Pacific Ocean and is the fourth most populated country.
It is said to be an Amazonian country, since out of a surface of 1'285,216 km2 , 53.5 million hectares are rainforest. It is limited to the north by Ecuador and Colombia, to the south by Chile, to the east by Brazil and Bolivia and to the west by the Pacific Ocean. Its geographical location makes it an important port of entry for business, tourism and trade.
In the geography of Peruvian territory, the three different regions can be distinguished by the topography and the climate:
The first region, the Coast, extends from the shore to the mountain range of the Andes. It reaches a height of 1800 m above sea level. Its main cultivations are cotton, sugar cane and rice, as well as fruit (grapes, oranges, tangerines, mangoes, among others). 52% of the population lives in the Coast, whose area is 11% of the total country surface.
The second region, the Sierra, is made up of a complex series of steep mountains and high plateaus, which are part of an integrated Andean system that extends throughout America. Its main agricultural products are potatoes, sweet potatoes, cereals (corn and wheat), quinua and coffee. Its main mining products are copper, gold, silver, iron, etc. 35% of the population lives on the Andean region, whose area is 32% of the total country surface.
And the third region, the Amazonian, is the most expanse, since it constitutes 57% of the territory in which 13% of the population lives. Its main products are fruit, tropical woods (ebony, cedars, among others) and refined petroleum.
Peru features a wide variety of climates that promote the abundance and diversity of natural resources. It presents 28 different climates and this is the reason it is one of the biologically richest countries in the world. It has, besides a total of 84 of 104 life supporting areas in the world.
Peru is one of the main producers of fish flour, since the South Pacific seaboard is one of the richest in the planet. Peru has - among other minerals - large copper, zinc, and gold deposits, thus being one of the richest mining countries. Moreover, it has a great hydroelectric power potential thanks to its rivers, and its rainforest contains important petroleum and gas reserves, whose exploitation is carefully carried out so as not to alter the ecosystem.
- Business Outlook
The economy's main indicators have improved substantially, over the last decade; inflation is now down to international levels and is projected to remain stable due to sound management of the money supply. GDP growth is consistent with the current overall international economic order The Peruvian Government understands that the economy must be ran with utmost responsibility and prudence, and is proceeding likewise, earning the praise and support of the international financial community.
On Investments Protection, the Peruvian Congress has ratified the subscription of the Convention Establishing the Multilateral Investment Guarantee Agency (MIGA) of the World Bank. Nowadays, important investments are developing in Peru under coverage issued by MIGA, mainly in mining and financing sectors. In the bilateral field, Peru has subscribed Bilateral Investment Treaties for the promotion and protection of investments from 28 countries of Europe, Asia and America. At present, negotiations for subscribing BITs with twelve more countries. With the same purpose, in December 1992, Financial Agreements on Investment Incentives were concluded with the government of the United States. In accordance with such agreement, the Overseas Private Investment Corporation (OPIC) issues insurance, re-insurance or guarantees to cover US private investments in Peru.
On the Expansion of Marketplaces, a proactive attitude regarding its participation in integration mechanisms strengthens market conditions. In that sense, investors already established in Peru can use its vast natural resources and competitive advantages and access these expanded markets. Peru is a member of the free trade area accorded amongst the Andean Community nations, which include Bolivia, Colombia, Ecuador and Venezuela and means a market of 113 million consumers. Additionally, Peru has concluded an agreement with Chile for a progressive establishment of a free trade zone. In few years, we expect the Andean Community and MERCOSUR agree a South American free trade zone. With regard to the US market, the recently renewed and expanded Andean Trade Preference and Drug Eradication Act (ATPDEA) benefits 5 500 products, which will enter this competitive market with zero tariff. In the meanwhile, the subscription of Free Trade Treaties with the USA, Canada and Mexico is underway. Likewise, Peru has great expectations respect to the development of negotiations for the establishment of the Free Trade Area of the Americas (FTAA), where nowadays it has active participation. The establishment of the FTAA involves a market of 34 countries with 800 million people.
As to the European Union, the General System of Preferences for the Andean countries sets zero tariffs for fishing, agricultural and textile products for which Peru provides competitive advantages due to its natural resources. Finally, our country has become a member of the Asia Pacific Economic Cooperation (APEC) forum, which comprises 50% of the world’s trade. This makes us a natural link between the industrialized Asian economies and the emerging countries of Latin America.
Peru is signatory to the most agreements on intellectual property right, especially, the Berne Convention for the Protection of Literary and Artistic Works, Paris Convention for the Protection of Industrial Property, Rome Convention for the Protection of Performers, Producers of Phonograms and Broadcasting Organizations, and the WIPO Copyright Treaty. Peru is also member to the World Intellectual Property Organisation (WIPO) and the Trade-related Aspects of Intellectual Property of the WTO was incorporated to the domestic legislation in 1995, as part of Peru’s ratification of the Marrakech Agreement.
On International Arbitration, eventual differences between investors and the State on investment matters may be referred to Arbitration Tribunal of the Convention on the Settlement of Investment Disputes – ICSID, or to the United Nations Commission on International Trade Law. Peru has also ratified the United Nations Convention on the Recognition and Enforcement of Foreign Arbitral Award and the InterAmerican Convention on International Commercial Arbitration.
Peru's main exports as of 2004 were to USA, China, UK, Chile, Japan, Spain, South Korea, Taiwan, Singapore, among others. Main exports to Singapore are Main exports to Singapore are fuel oils, canned seafood, fishmeal, cotton clothing, copper, grapes and ornamental fish.
Main export products are: Gold, copper, zinc and other minerals, fish-meal & other seafood products, textile & agricultural products.
Peru is estimated to have 16% of the world's known mineral resources. ( Copper, Gold, silver, Zinc, Tin, Lead and others )
This Embassy can provide you with a list of top importers and exporters.
Peru's current legislation provides that foreign investors in Peru will enjoy the same treatment, as Peruvian nationals, that all investors may access the foreign exchange market freely, and that all earnings on their investment may be disposed of at the investor's discretion, be it by reinvesting it in Peru, or sending it abroad.
As you can see, we have been working very hard to make Peru an appealing place for you to make business in. Not only will you find a country endowed with natural resources and skilled workers, but also, and perhaps more important, a legal framework and renewed infrastructure that will allow you to take advantage of such resources in long run projects, all in a climate of stability and security for your investment, guaranteed.
For more information: http://www.proinversion.gob.pe
or contact us: (65) 6738 8595