José Luis Silva Martinot Minister of Foreign Trade and Tourism February 2013 Peru: Strategic...

José Luis Silva MartinotMinister of Foreign Trade and Tourism

February 2013

Peru: Strategic Partner for Germany in South America

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Macroeconomic Environment

Number of positions Peru improved in the

last 5 years in the WEF Global

Competitive Ranking

25 positions

25 positions

Ranked 61 in the 2012-2013 ReportRanked 61 in the 2012-2013 Report

Peru’s GDP increased during the 2002-2010 period

6% annually6% annually

6.3% GDP growth at the end of 20126.3% GDP growth at the end of 2012

Peru’s dynamic and competitive economy has continued to grow despite the international financial crisis

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Why Invest in Peru?

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1. Internationally-recognized macroeconomic strength

2. Favorable invesment climate

3. Integrated trade policy – market access

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Peru Chile Colombia Mexico Brazil

2012 2011 2011 2011 2011 2011

Ease of Doing Business 43 36 37 45 48 130

Starting a Business 9 54 4 10 5 20

Dealing with Construction Permits

18 97 17 8 10 27

Registering Property 1 24 5 4 25 13

Trading Across Borders 8 73 5 17 9 27

Protecting Investors Inversor

2 20 5 2 12 14

Peru is at the forefront of the doing business climate ranking in relation to other countries in Latin America

In 2012, Peru reached position 43 in the ease of doing business ranking

Source: Doing Business 2012, World Bank. Ranking of 185 countries

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Requirements: USD$ 5 million minimum investment in any

sector of the economy.

US$D 10 million in the mining and

hydrocarbon sectors.

Period of Validity: 10 years. Concessions: Extended for the

concession’s period of validity.

Peru offers a favorable legal framework for foreign investment

Non-discriminatory treatment: foreign investors are treated the same as national investors Unrestricted access to most economic sectors* Free capital transfers Free competition Guarantees for private property Freedom to acquire shares from nationals Freedom to access internal and external credit Freedom to remit royalties Investment Treaty Network; Member of the International Center for Settlement of Investment

Disputes (ICSID) and the Multilateral Investment Guarantee Agency (MIGA) Participates in the Organization for Economic Co-operation and Development (OECD) Investment

Committee - Promotes the implementation of guidelines for multinational companies

Legal Stability

Agreements

* Investments that require authorization: Those within a 50Km range from the country’s borders and those involving arms, munitions and explosives. Also, investments in coastal trade transportation and air transport require a local majority shareholding partner.

Source: Proinversión

Good prospects for Peruvian exports (USD$ millions)

Source: SUNAT* Estimate

During the 2000–2005 period, we doubled our exports

By 2016 Peru will try to double its exports, triple its non traditional exports and double the number of exporting companies

20 years to double exports

Now, we double our exports every five years

By 2016 at 5,000By 2016 at 5,000

By 2016 at US$ 23,000 millionBy 2016 at US$ 23,000 millionBy 2016 at 15,600By 2016 at 15,600

By 2016 at USD$ 2,730By 2016 at USD$ 2,730

US$ 10,867

MM Non traditional exports*

US$ 10,867

MM Non traditional exports*

4,645Exported tariff items **

4,645Exported tariff items **

US$ 1,478Exports per capita*US$ 1,478Exports per capita*

7,873Exporting companies**

7,873Exporting companies**

The success of the Peruvian exporter generates a revitalizing effect on the national economy (2012*)

Source: SUNAT*Estimate for 2012** Jan-Nov 2012

Peru: on today’s world stage

Coherent and responsible macroeconomic policiesMaking the most of trade liberalizationExport growth and diversificationForeign investment growthDevelopment with social inclusion

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Trade Liberalization

Trade Agenda: Free Treaty Agreements, secure world market destinations

for our exports

+ 2,500 million

consumers

+ 2,500 million

consumers

+ 55 countries

around the world

+ 95% of our exports

head to countries

with whom we have

agreements

+ 95% of our exports

head to countries

with whom we have

agreements

“The FTAs act as reform mechanisms for the State’s modernization and they become strong and solid promoters

for the attraction of private and foreign investment” http://www.acuerdoscomerciales.gob.pe/

In force

Coming into force In negotiation

Trans-Pacific Partnership Agreement

Pacific Alliance

Peru-GermanyTrade Relations

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Germany is our #1 trade partner in the EU

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Peru: Exports to the European Union 2012* (USD$ Millions)

Source: SUNATData November 2012

Our Trade Exchange with Germany has grown 26% in the last two years

14Source: SUNAT

Non Traditional Exports(USD$ Millions FOB)

There is great potential for the development of Peruvian non traditional exports to Germany

Main Non Traditional Products 2012*

1. Cochineal carmine (USD$ 6.63 million).2. Zinc oxide (USD$ 7.87 million).3. Coloring laquers (USD$ 5.8 million).4. Asparragus, prepared or preserved (USD$

12.47 million).5. Other vegetables, vegetable mixes (including

“wild” ones) (USD$ 7.10 million).6. Other shirts, cotton, with a neck and partial

open front, for men (USD$ 5.04 million).7. Zinc sheets, strips, flat rolls, with a thickness

greater than a 0,65mm (USD$ 3.02 million).8. Shirts, cotton, with a neck and partial open

front, single color fabric (USD$ 1.63 million)

Source: SUNAT *Jan-Nov 2012

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And Peruvian traditional exports to Germany grew by 76% between 2008 and 2012*

Traditional Exports(USD$ Millions FOB) Main Traditional Products 2012*

1. Copper minerals and its concentrates (USD$ 806.94 million).

2. Coffee, not toasted, non decafinated, except for sowing (US$ 320.85 million).

3. Fish flour, powder, pellets, with a fat content greater than 2% in weight (USD$ 263.85 million).

4. Silver minerals and its concentrates (USD$ 62.94 million).

5. Gold minerals and its contents (USD$ 14.89 million).

Source: SUNAT

*Jan-Nov 2012

• Main imported products:– Assembled vehicles and vehicles for merchandise transport– Boards, panels and consoles for the control and distribution of electric energy– Machinery parts– Mechanic shovels for excavation and loading– Other medicines, except analgesics for human use

+24%

+97%

Germany is Peru’s main provider in the European Union

Development of the amount of exported and imported products in German trade

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Source: SUNAT

Total number of tariff items exported

Total number of tariff items imported

Development of the number of exporting and importing companies in German trade

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Source: SUNAT

Total number of exporting companies

Total number of importing companies

Foreign Direct Investment from Germany to Peru

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Main FDI Countries of Origin in Peru, at the end of 2012

Source: PROINVERSION

FDI Stock from Germany to Peru, by sector (%), 2012

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Trade Opportunities in Peru

Sector Indicators• 27% average annual growth rate (2000-2011)• 1,648 exporting companies in 2012* (+6%

in relation to the same period in 2011)• In 2012* the sector grew 7% in relation to

2011

Agriculture and livestock sector

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Main Export Destinations*

Source: SUNAT. Developed by Market Intelligence - PROMPERUSource: SUNAT. Developed by Market Intelligence - PROMPERU

*Data for Jan.-Nov. 2012

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Sector Indicators• 17% average annual growth rate (2000-2011)• 462 exporting companies in 2012*

(+3% in relation to the same period in 2011)• In 2012* the sector grew 1% in relation to

2011

Fishing Sector




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Sector Indicators• 10% average annual growth rate (2000-2011).

• 2,546 exporting companies in 2012* (+8% in relation to the same period in 2011)

• In 2012* the sector grew 10% in relation to 2011

Textil and Apparel Sector

Principales Destinos de Exportación*



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Biocommerce sector

Sector Indicators• 21% average annual growth rate (2000-

2011)• 464 exporting companies in 2012* (+10%

in relation to the same period in 2011)• In 2012* the sector had a -32 % variation

in relation to 2011




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Mining Sector

Sector Indicators• 22% average annual growth rate (2000-2011)• 182 exporting companies in 2012* (+1% in

relation to the same period in 2011)• In 2012 the sector had a -6% variation in

relation to 2011




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Energy Sector

Sector Indicators• 25% average annual growth rate (2000-2011)• In 2012* the sector grew 11% in

relation to 2011




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Investment Opportunities in Peru

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Short-term Private Investment Promotion Projects2012 – 2013

(25 Projects)

Investment Opportunities

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Agro Sector:• Majes Siguas Project (hydroenergy and irrigation project)• Chavimochic Prospect (hydroenergy and irrigation project)• Tierras Eriazas (public tender for uncultivated lands, without right to water, belonging to the Ministry of Agriculture)

Mining Sector:•Magistral Mining Project (copper deposit, with molymdenum and silver content )•Huayday Ambara Prospect (gold)•Remanentes de Michiquillay Mining Project (limestone)

Investment opportunities

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Tourism Sector:

•Chaco – La Puntilla Lote E (Operation and Maintenance of Tourism Marina – Paracas) •Kuelap Cable Car (Tourist Cable Car Transportation System – Amazon Region)•San Lorenzo Island Project (Tourism projects in the islands of San Lorenzo and El Frontón – Callao)

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Tourism

Extraordinary Tourism Destination

• Its art and culture also stand out: dances, music, regional costumes, religious festivities, ancient handcrafts, traditional cuising, etc.

• High satisfaction level from tourists: “89% “would recommend it” as a tourism destination.

• Climate variety given our geographical diversity.

Source: Country Brand Index 2010, Foreign Tourist Profile 2009

Attributes:

• Birthplace of the Inca Empire, one of the greatest civilizations in the Americas. Eleven sites declared Cultural and National Heritage Sites by UNESCO

• It has an exhuberant Amazon region, lakes, lagoons, snow peaks, canyons, gorges and beautiful beaches. In addition to a variety of flora and fauna that bestow it with a unique beauty.

…with exceptional tourism destinations

KuelapKuelap

Moche RouteMoche Route Beaches in the NorthBeaches in the North Arequipa - ColcaArequipa - Colca

Lake TiticacaLake TiticacaThe AmazonThe Amazon

Peru has attractive sustainable tourism development investment opportunities for the private sector: historical, cultural, nature, existential, adventure, and others.

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And a first class gastronomical offer

• Peru’s gastronomy is considered among the most important in the world.

• The good quality of Peruvian food is highly regarded by tourists – 97% considered it first rate.*

• There are more than 20 Gastronomical Peruvian Franchises in more than 16 countries.

• Peruvian Franchise Presence in Europe: Astrid & Gastón, Tanta, Segundo Muelle, entre otros.

• * Foreign Tourist Profile 2009Peruvian Gastronomy:

• First rate quality, a “Flagship Product”. • Internationally competitive.• Cuisine with history and tradition - “Living Culture”.• At present Peru is experimenting a “Gastronomical

Boom”.

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Jorge Chávez International AirportThe most modern airport in South America 2009 -20121

• Jorge Chávez International Airport is located in the Constitutional Province of Callao, close to the Port of Callao and 10 km from downtown Lima.

• It is Peru’s main airport, concentrating all international flights and the majority of all national flights in the country, as well as serving more than 12 million passangers each year.

• It stands out because of its enourmous projections related to connecting flights between the Americas, Asia-Pacific and Europe, which as a result has brought about a sustained growth in passenger flow, cargo and mail.

International Arrivals from Germany to Peru

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German Tourist Arrivals to Peru

OPPORTUNITY

Tourists coming from Germany represent 2.2% of the total international tourist arrivals in Peru during 2012.

• In 2012 Peru saw the arrival of 46,787 german tourists.

• Germany is the third emitter of tourists to Peru in Europe.

Source: MININTER- DIGEMIN

José Luis Silva MartinotMinister of Foreign Trade and Tourism

February 2013

Peru: Strategic Partner for Germany in South America

José Luis Silva Martinot Minister of Foreign Trade and Tourism February 2013 Peru: Strategic...

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