In 2011, the political campaign proposals of the current Peru’s President caused a prudential attitude of major investors’ and market players. However, the economic environment began to look less uncertain after July 28th, when the first real measures were made public.
Despite this local political environment and the international economic downturn, the country economy continues to show strong foundations. The Gross Domestic Product (GDP) grew by 6.9% in 2011, with the significant support of the private investors, adding up to the several months of uninterrupted growth. Also Peru’s international reserves exceeded US$ 48 billion, representing a 29% of the Peruvian GDP. By the end of June 2012, the reserves were close to US$ 58 billion.
The credit rating of the Peruvian banking system was upgraded by Standard & Poor’s to 4/10, the same rating given to banking systems of larger economies such as Mexico and Brazil. Also in 2011, Peru was considered by multinational companies and organizations as an attractive country for private investment. The newly-signed free trade agreements are already increasing revenues and generating more work opportunities.
However, there are still a number of issues that need to be addressed, such as the promotion of human capital, investment in research and technology, infrastructure, industrialization of the primary resources for exportation, the review and update of national labor and tax policies as well as an improvement in social development. In general terms, we are able to assure that the forthcoming years will be years of opportunities for Peru, a perfect time to reduce the gaps and set the right foundations to secure a promising future.
This is the fifth consecutive year in which PwC publishes Doing Deals in Peru, which contains the latest and most reliable information on the major macroeconomic, tax, corporate, labor, financial, social, and industrial matters. We are confident that every article of this publication will be a very useful tool to help you in your decision-making to begin doing business in our country.
Our 87 years of experience providing business advisory services in Peru is always at your service to assist your organization and achieve your expectations.
Territory Senior Partner