WZ 1107 E Wirtschaftszweige-Peru

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PeruMajor Business Sectors

Compiled by:

Swiss Chamber of Commerce in Peru

Lima, July 2011

Overview and trends

In recent years, the Peruvian economy has experienced sustained growth, reflecting considerableeconomic and political strengthening within the region. In 2010, Perus GDP increased by 8.8%, hav-ing defied the global economic crisis by registering a growth of 0.9% in 2009.

Inflation has shown a downward trend over the last decade, placing it among the lowest and moststable in the region (Average of 2.08% in 2010). The high levels of public and private investment, therise in exports and strong internal demand signal a bright outlook for the future of the Peruvian econ-omy, setting the country apart as one with interesting commercial investment opportunities. DirectForeign Investment has developed markedly over the last few years; the countries which invest most

are Spain (24 per cent), the United States (14 per cent), South Africa (10 per cent) and Chile (8 percent). Together, these four countries accounted for over 50 per cent of investment in Peru in 2008(18 billion USD). The sectors receiving most investment are industry, finance, mining, communica-tions, and energy, together making up 85 per cent.

The dynamics of Peruvian international trade over the last decade have been remarkable. Import andexport volumes have grown considerably, largely due to new free trade agreements (FTA) with im-portant commercial partners as the USA, Canada and China. Respective to the FTA with EFTA, theagreement has come into effect on July 1st 2011 for Switzerland and Liechtenstein (still not for Nor-way and Iceland). Sustained investment based on sound economic and political stability has alsocontributed to this favorable situation. In 2010, Peruvian exports totaled more than USD 35 billion,growing by over 31% compared to 2009, while imports exceeded USD 29 billion, representing an

increase of over 36%.

Accordingly, trade between Switzerland and Peru has increased significantly in recent years. Peruvi-an imports from Switzerland have grown by almost 127% since 2001, reaching 36.3 million USD in2010, while exports to Switzerland rose by 173%, giving a total of 118.6 million USD (not includinggold, which makes up to 99% of Peruvian exports to Switzerland).

On 5th of June 2011, Ollanta Humala was elected for a five-year term as new president of Peru. TheGana Peruparty candidate won 51.44% of all votes, while his rival in the second-round run-off, KeikoFujimoriof Fuerza 2011, was backed by 48.55% of Peruvian voters. In the new composed parlia-ment, the new presidents party cannot count on a majority of seats. Whereas Humala started his cam-paign in 2006 as a strongly left-wing candidate, he now stands for a more center-left position, close to former

Brazilian president Lula da Silva. It is indeed expected that Humala will increase the influence of the state onthe Peruvian economy. However, experts assume that valid free trade agreements will be respected, but that


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negotiations of new agreements will not be prioritized. According to the three major rating agencies, Humalaswin does not affect Perus healthy economic fundamentals or put its investment grade credit rating at risk. Thisremained to be confirmed after he assumes his function on July 28

th2011.

GDP Sector Data

A GDP growth of 8.8% was recorded in the non-primary sectors, primarily construction, trade andnon-primary manufacturing. The primary sectors show a different picture; while agriculture rose by4.3, the fishing sector posted a downturn of -16.4%, and mining fell by -0.8%, the latter reflecting thedrop in international metal prices.

Construction grew by 17.4%, boosted by a number of housing projects. The manufacturing sectorrecorded a 13.6% growth, driven by greater foreign and domestic demand. The trade sector rose by9.7%, and the water and electrical sector rose by 7.7%.

GDP 2010

Business Sector % of GDP1 Growth 2010/2009 Value in MM USD

2

Agriculture 7.47% 4.3% 5,491

Fishing 0.34% -16.4% 252

Mining 5.20% -0.1% 3,825

Manufacturing 14.97% 13.6% 11,007

Electricity and Water 2.00% 7.7% 1,474

Construction 6.73% 17.4% 4,947

Trade 14.95% 9.7% 10,994

Other services 38.66% 7.4% 28,421

Taxes and Rights to import 9.67% 10.8% 7,113

Global GDP 100.00% 8.8% 73,524

1Based on pricelevel of 1994

2Exchange rate 31.12.2010, S/. 2.857

Source: INEI

GDP Outlook

The Peruvian government has forecast a GDP growth of 6.5% for 2011.In its Multi-annual Macroeconomic Framework for 2012-2014, the Ministry of Economy and Finance(MEF) predicts a 6%-6,5% average annual GDP increase, while exports are anticipated to rise by7.5%-9% annually. The Framework also points to expected rises in private and public investment of

5.6% and 12.0% respectively, and in private and public consumption, by 5% and 4.8% respectively.


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Exports 2010

Business Sector % of Exports Growth 2010/2009 (%) Value FOB in MM USD2

1. Traditional products 77.5 31.7 27,285

Fishing 5.4 11.9 1,884

Farming 2.8 53.1 975

Mining 60.6 29.5 21,338

Oil and by-products 8.8 60.8 3,088

2. Non-traditional; products 21.8 23.9 7,676

Farming 6.2 20.2 2,197

Fishing 1.8 23.4 650

Textiles 4.4 4.3 1,559

Timber and paper and manu factured goods

1.0 6.3 357

Chemicals 3.5 46.2 1,225

Non-metalic minerals 0.7 70.0 251

Steel-metallurgy 2.4 70.0 860

Metal-mechanical 1.1 9.4 395

Other (incl. jewellery) 0.5 15.4 183

3. Other 0.7 56.0 244

4. TOTAL EXPORTS 100.0 30.0 35,205

Source: SUNAT


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Imports 2010

Business Sector % of Imports Growth 2010/2009 Value FOB in MM USD

1. Consumer Goods 19.0 41.5 5,713

Non-durables 9.7 33.6 2,910

Durables 9.4 50.7 2,803

2. Inputs 48.3 38.3 14,481

Fuel, lubricants and related 14.1 37.8 4,220

Raw Materials for agriculture 3.2 13.8 972

Raw Materials for industry 31.0 41.7 9,288

3. Capital Goods 32.6 34.1 9,770

Construction Materials 4.1 31.8 1,238

For agriculture 0.3 11.9 85

For industry 19.8 24.5 5,907

Transport equipment 8.5 66.5 2,539

4. Other Goods 0.01 -241.9 4

5. TOTAL IMPORTS 100.0 37.4 29,967

Source: SUNAT

Date: July, 2011Author: Swiss Chamber of Commerce in PeruAddress: Av. Salaverry 3240, Piso 4

Lima 27PeruTel.: 0051 1 264 35 16Fax: 0051 1 264 35 26E-Mail: [email protected] /[email protected]

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WZ 1107 E Wirtschaftszweige-Peru