Peru Country Pulse

8/12/2019 Peru Country Pulse

http://slidepdf.com/reader/full/peru-country-pulse 1/25



of consumers wanted a tablet computer for Christmas, while 21%

wanted a laptop. 70% of respondents said they intended to give

gadgets as presents.

Government spending on water infrastructure soars (December 2013)

Many Peruvians still lack access to drinkable water: According to

Euromonitor International data, 69.6% of Peruvian households had

access to a water supply in 2012, up from 68.2% during 2008. However,

according to official statistics, public spending in this area has risen by

64% since 2011, so this figure is set to increase markedly over the

coming years. According to René Cornejo, minister of Housing,Construction and Sanitation, access to running water means that people

no longer have to spend time and money purifying water.

Most Peruvian gamers are in their 30s (December 2013)

Very few Peruvian households have video games consoles (just 2.9% in

2012, Euromonitor International data states). 70% of Peruvian gamers

are in their thirties, according to Juan Francisco Echeandía of Smart

Gamers, a website that sells and rents video games. “These are the

Nintendo generation’ (those who grew up playing Nintendo consoles in

the 1980s and 1990s),” he said.

Echeandía added that the most popular video games in Peru at themoment were “Grand Theft Auto V,” “Pro Evolution Soccer,” “FIFA 14,”

“Call Of Duty: Black Ops 2” and “God Of War: Ascension.”

Diamond sales sparkle (November 2013)

Value sales of diamonds in Peru have grown at an average annual rate

of around 28% over the past five years, business newspaper El

Comercio claims. According to Gerardo Zela, general manager at Lima

jewellery shop Diamante Perú, consumers are increasingly opting for

arger and higher-end stones. He added that his shop was currently

selling an average of around 110 engagement rings per month, with

most priced between US$2,500 and US$3,500. As in many developedeconomies, Peruvian men often give an engagement ring to their

fiancée.

Smelling sweet, at least in the cities (November 2013)

According to newspaper La República, deodorant use, which was a rarity

n Peru as recently as a decade ago, has now gone mainstream, at least

n urban areas. Citing industry sources, it reports that 70% of volume

sales of deodorant in Peru are accounted for by Lima. Euromonitor

International data states that real value sales of deodorant in Peru rose

by 29.3%, to US$98.7 million, between 2007 and 2012, with over 80%

of the market accounted for by roll-ons and sprays.

Mining companies among the most-popular employers (November 2013)

An international survey conducted by human resources consultancy DQT

during mid-2013 has found that mining companies are popular in Peru,

with five of them making a list of the country’ s top-ten employers.

Mining companies were found to be much more popular in Peru than in

Australia, Canada or South Africa (other countries where mining is a

major economic activity). Peruvians were found to perceive mining

companies as offering good wages and conferring a degree of prestige

on their employees. Mining companies have also invested in improving



their public perception, sponsoring cultural events, for example.

Asian marques to the fore in local car market (October 2013)

Car sales have boomed in Peru over recent years: Euromonitor

International data states that real annual consumer expenditure on the

purchase of cars, motorbikes and other vehicles rose by 26.1% between

2007 and 2012, to US$2.8 billion. By 2012, 21.3% of households had a

passenger car. Cheaper Asian models have proven to be particulalry

popular, with Korean carmakers Hyundai and Kia to the fore. A plethora

of low-cost Chinese marques, such as JAC and Chery, are also

ncreasingly visible.However, the sheer number of marques now available in Peru is

confusing some consumers. The Peruvian Car Association (AAP) states

that about 140 different marques are currently available. According to

one commenter on the AAP’ s Facebook page, “How many Asian brands

do we have in Peru? Aren’ t they too many?”

The place where Peruvians are born (October 2013)

The National Institute of Perinatal Care (INMP) in Lima is an important

andmark for many Peruvians. For some, it is akin to the Eiffel Tower in

Paris as a national monument. Founded almost 190 years ago, close to

one-seventh of the country’ s current population (some four millionpeople) were born there, according to government data. It was

particularly active during the 1960s and thus has a special place in the

hearts of many members of Generation X. These days, it mainly deals

with critical and emergency cases, but it retains an important place in

the national consciousness.

Gourmet food growing in popularity (October 2013)

Local consumers are buying gourmet packaged food in greater numbers,

usually from small retailers called gourmet shops or delicatessens.

These types of products are usually difficult to find in supermarkets and

traditional grocery retailers. This is helping to drive strong growth inreal value sales of packaged food, which rose by 23.6% in real terms

between 2008 and 2013, to just over US$9 billion.

“Until a few years ago, gourmet shops were scarce in Lima, except for

such districts as Miraflores and San Isidro. Now, you can find them in

the likes of La Molina, Santiago de Surco, Barranco, Magdalena del Mar

and Jesús María,” commented Jorge Baertl of retailer Affumicato

Gourmet, who was speaking to website Terra.pe. He added that many

consumers liked to combine gourmet snacks with premium wine,

whiskey or pisco (grape brandy).

“Buy Peruvian” campaign gains ground in textile market (September2013)

The notion of “buying Peruvian” is gaining ground among local

consumers, particulalry in the textile market, where local traditions

remain strong. In early September, a large number of textile workshops

and shops went “on strike” in Lima’ s Gamarra district to highlight what

they describe as “massive” imports of cheap Chinese products, which

they claim have already led to 9,000 job losses in the sector. “A trade

agreement has enabled one billion Chinese garments to be imported

nto Peru,” said Arturo Zavala, head of the Gamarra Manufacturers



Federation.

“Peruvian quality is better – that is why we defend it,” said a young

man who was handing out leaflets that called on consumers to “Buy

Peruvian.” “We support Peruvian fabrics and designs, and we want

everyone to join in,” his female companion added. Both were speaking

to local media.

Healthcare the top priority for families (September 2013)

A survey conducted by consultancy Arellano Marketing during mid-2013

has found that Peruvian families prioritise spending on health and

education. “Above all things, families prioritise health, especially that

of their children, followed by their own health,” said Rolando Arellano,

head of Arellano Marketing. The survey found that 70% of households in

Social Class A had private health insurance. However, Social Class C

was found to account for the biggest proportion of private health

nsurance policies (41% of the total).

"Snail” mail in rude health (September 2013)

On August the 29th, Peruvians celebrated Postman’ s Day. The

profession is still alive and well, in spite of the growing popularity of

smartphones and instant messaging. Many marked the day by postingetters to friends and family. Serpost (the national post office)

organised an event that saw a group of postmen dress like “chasquis” ,

the ancient messengers of the Inca Empire, to bring “peace messages”

to President Ollanta Humala. This event received widespread media

coverage and was a hot topic on social media.

Meanwhile, a bookshop in downtown Lima gave away paper and pens

free of charge to book buyers in an effort to encourage them to write

etters. According to Euromonitor International estimates, consumer

expenditure on postal services in Peru will reach US$52 million in 2013,

up 42.5% in real terms since 2007.

Where’ s my bonus? (August 2013)

A growing number of Peruvian workers receive a twice-yearly bonus (in

July and December), but the practice remains less prevalent in Peru

than in many other Latin American countries. While these bonuses are

mandatory in Peru, this law is widely flouted: A survey of workers

conducted by website Trabajando.com during July found that 42% of

them did not receive bonus payments. Among those who did receive a

bonus, almost half of them (49%) said they had used it to repay debt,

while 29% said they had saved it, with just 22% spending it.

Anyplace is good for meeting (August 2013)

The rapid rise of the Peruvian middle class has outpaced the supply of

spaces they regard as suitable for them to meet for leisure or work,

such as cafés, bars and restaurants. Thus, many Peruvians will happily

meet for a chat on the street or even in a garage forecourt. Shopping

malls are also popular in this regard. A global survey conducted by

office solutions provider Regus during late 2012 found that some of the

meeting places favoured by Peruvian respondents included cars,

convents, abandoned railway tunnels and even a worm farm – locations

perhaps more appropriate to a Cold War thriller.



Celebrating independence by leaving the country (August 2013)

Every year on July the 28th and 29th, Peruvians celebrate their

“National Holidays,” which commemorate their independence from

Spain. Some affluent consumers use this event as an opportunity for

foreign travel. According to the National Tourism Association (Canatur),

the most popular destinations this year were the USA, Mexico, Colombia

and the Dominican Republic, with the average trip lasting a week and

the average traveller spending US$2,000. Carlos Canales, head of

Canatur, said that Peruvians favoured all-inclusive bundles and warm-

weather destinations, such as Miami, Cancun in Mexico and Caribbeanbeach resorts.

Illegal cable TV hook-ups widespread, but crackdown is having an effect (July 2013)

According to Euromonitor International data, 23.1% of Peruvian

households (1.8 million) had cable TV in 2012. However, with illegal

cable hook-ups commonplace, the true figure is actually much higher.

According to 2012 data from the Peruvian Household Survey, which was

conducted by the National Statistics and Computing Institute (INEI),

more than 2.5 million Peruvian homes were watching (as opposed to

paying for) cable TV.

However, the government and cable companies are attempting to dealwith this problem: Between May 2011 and May 2013, Operation DUNA

saw 208,000 illegal connections severed. This led to 90,000 illegal

users switching to legal cable TV services.

Survey profiles Peruvians living abroad (July 2013)

About three million Peruvians (almost 10% of the country's population)

reside overseas, and virtually every family has at least one member

iving abroad. The first Worldwide Survey of the Overseas Peruvian

Community was conducted during 2012 by the National Institute of

Statistics and Informatics (INEI), the Ministry of Foreign Affairs and the

International Organization for Migration. 80% of respondents said theywould return to Peru if they could, while 70.5% were of the opinion that

ife in Peru was getting better.

The survey also found that 52.7% of Peruvian migrants were female,

with half of all migrants aged between 18 years and 39 years. 56.6% of

them had a higher education, 52% were married and 62% rented a

home in their destination country.

Learning to live with earthquakes (July 2013)

Earthquakes are a part of everyday life across Peru. According to the

country's Geophysical Institute (IGP), 94 earthquakes that could be felt

by people occurred during the first quarter of 2013 alone. Most of themhappened along the coastline, where the population tends to be more

nformed and better prepared for these events.

“Everyone should know what they have to do and start planning ahead

n order to minimise the damage that occurs when an earthquake takes

place,” said Hernando Tavera of the IGP. Many Peruvians take seismic

vulnerability into account when choosing a place to live or building

materials.

Digestive health a major issue (June 2013)

According to nutritionist Diana Mesones, who was speaking to news



website Diariocorreo.pe, eight out of ten Peruvians suffer from gastritis

(an inflammation of the lining of the stomach). She said that this was

due to poor eating habits, stress and drinking excessive amounts of

coffee and alcohol. Eating on the street, irregular meal times, smoking

and high-fat foods were also cited as contributory factors. She added

that the fact that many Peruvians were lactose intolerant also played a

role.

Mesones was citing data from a nationwide study that was conducted

by the Peruvian Ministry of Health during 2010. Such is the extent of the

problem that some restaurants in Lima even offer antacids to departingcustomers.

Despite mobile phone boom, a fifth stil l lack telecoms access (June 2013)

Mobile phone use is expanding rapidly in Peru: Euromonitor

International data states that 60.5% of households had a mobile phone

n 2012, up from 34.7% during 2007. However, according to data

published recently by consultancy Grupo PPP, as of late 2012, around

20% of the country's population lacked access to a telephone (either

andline or mobile). This problem was found to be particularly acute in

solated rural areas. “Why would I buy a mobile phone? There are no

antennas here, so we cannot get a signal,” commented Gladys, whoives in a mountainous region.

Earthquakes rattle Lima (June 2013)

Sitting as it does on the edge of the “Ring of Fire” (the highly

seismically active Pacific Rim), Peruvians are no strangers to

earthquakes. However, two tremors in as many days during mid-June

(the second of which measured 5.1 on the Richter scale, according to

the Geophysical Institute of Peru – although the US Geological Survey

reported it as 4.6), have worried Lima residents, even though the

damage they caused was relatively minor.

News agency United Press International reported that “People fled intothe streets in panic, but there were no immediate reports of injuries or

damage.” Telephone services were disrupted, but they were quickly

restored. The epicentre was just 35km northwest of the city, and some

are fearful that these tremors may indicate that a reprise of 2007's

much more powerful 8.0 quake is in prospect in the near future.

Fewer living in poverty (May 2013)

The number of Peruvians living in poverty fell by half a million during

2012, to 7.8 million (around a quarter of the population), according to

data from the Peruvian National Statistics and Computing Institute

(INEI). According to Alejandro Vílchez, head of INEI, strong economicgrowth and increased spending on social programmes were the key

factors in this. Euromonitor International data states that real GDP in

Peru expanded by 6.3% during 2012.

As a result, many now have significant discretionary income for the first

time. “I bought cheese spread for the first time in my life,” said a

woman from Lima, who was speaking to radio station RRP. While the

poverty rate remains acute in rural areas, it is falling even here, from

56% to 53% between 2011 and 2012.

Peruvian design goes back to its roots (May 2013)



During Lima Fashion Week, an event that aims to promote local

designers, the catwalks featured designs inspired by pre-Columbian and

regional Peruvian traditions. Such Peruvian designers as Sitka Semsh,

Amaro Casanova and Ani Álvarez Calderón reflected these influences in

their collections.

Semsh displayed outfits based on a contemporary interpretation of how

Inca princesses dressed; Álvarez Calderón was inspired by the Puno and

Lake Titicaca regions; while Casanova was influenced by La Fiesta de la

Candelaria, a regional religious festival. Such clothes are becoming

ncreasingly popular with affluent female consumers in Peru. Moregenerally, the use of Peruvian cotton and alpaca fibre by local designers

s also on the rise.

Even mothers now shop for Mother's Day (May 2013)

A survey conducted by consultancy Datum Internacional during early

May found that average expenditure for Mother's Day in Peru (celebrated

on the second Sunday of May, which fell on May the 12th this year) was

US$50. It also found that a majority (66%) of respondents intended to

spend the day at home with their families. It also identified what it

called “self -gifting” (saving up for a special treat) as a growing trend

among the country's mothers.Surge in credit card use, but defaults also on the rise (April 2013)

A decade ago, credit cards were almost unheard of in Peru, but

according to Euromonitor International estimates, there were 3.8 million

personal cards in circulation during 2012, up 50.4% since 2007.

However, the number of non-performing loans is rising, according to

business newspaper Gestión, which reported an increase of 14.2% in

the number of defaults on credit card debt between 2011 and 2012.

According to industry sources quoted by the newspaper, some card

holders have been overly optimistic about their financial prospects,

while others lack budgeting skills.Peruvian sports fans prefer foreign teams and players (April 2013)

Peruvians are well known for their patriotism, so it came as something

of a surprise when it was revealed that their most popular sports-

related Facebook pages mainly revolving around foreign teams and

players. According to data compiled by online analytics company

Socialbakers during early 2013, the most popular Facebook pages

among Peruvian internet users were those of Portuguese football player

Cristiano Ronaldo, who had around 900,000 Peruvian followers, FC

Barcelona (890,000) and Argentine player Lionel Messi (887,000). The

exceptions to this were local football club Alianza Lima and Peruvian

player Paolo Guerrero. Socialbakers estimates that 34.5% of Peruvians

are Facebook users.

What do time-poor young executives want to do? (April 2013)

45% of Peruvian executives aged under 45 years are not fully satisfied

with their lives, a survey conducted by polling company Ipsos Peru

during February and March 2013 has found. 61% of them complained

that pressure of work meant they could not spend as much time as they

would like with their families. 45% said they wanted to spend more

time travelling, while 30% desired to play more sports and 23% wanted

to devote more time to hobbies. Returning to education (16% of



respondents), spending time with friends (11%), having time for

themselves (6%), resting (5%), starting a business (5%) and outdoor

activities (3%) were also popular choices.

Fear of crime makes many reluctant to socialise outside of the home (March 2013)

According to a study conducted during the second half of 2012 by INEI,

Peru's national statistics bureau, 86% of Peruvians feel insecure. This is

mainly due to the country's high crime rate, with murders and other

violent crimes relatively commonplace. Those aged between 30 years

and 44 years and Lima residents were found to be the most likely to

feel insecure. This insecurity leads many Peruvians to spend theireisure time at home, rather than going out. According to the INEI, 38%

of Peruvians over 15 years of age have been a victim of crime.

Affluent consumers view billionaires as role models (March 2013)

Affluent Peruvians consumers are increasingly mimicking the habits of

high-profile billionaires. According to Forbes magazine, there are ten

Peruvian billionaires that influence local consumption habits in this

manner: Eduardo Belmont, CEO at Belcorp (a manufacturer of beauty

products); Carlos Rodríguez, CEO at Intercorp (a holding company);

Juan Fernando Belmont Anderson, CEO at Yanbal (cosmetics); Eduardo

Hochschild, CEO at Hochschild (mining); Alberto Benavides, president ofMinas Buenaventura (mining); the Brescia family, who own holding

company Grupo Brescia; and the Rodríguez family, owners of grocery

retail chain Gloria. For example, Juan Fernando Belmont Anderson's love

of golf has helped to popularise this game among Peruvian

entrepreneurs and executives, partly as a way of networking.

With gyms booming, Peruvians feel the burn (March 2013)

Until fairly recently, there were virtually no gyms in Peru. However, such

chains as Sportlife, Golds Gym and Bodytech are now sprouting up in

urban areas, especially in the vicinity of Lima. According to newspaper

La República, 12 new gyms are planned for Lima and other cities in Peruduring 2013.

“Around 3% of Peruvians will go to a gym this year,” said César López

of Bodytech Peru. While this figure is still relatively low by the

standards of many other Latin American countries, it is rising rapidly. A

growing number of consumers are opting for six-month or annual

membership, rather than merely joining for a month or two to get in

shape for summer. This reflects the fact that fitness and personal

appearance are increasingly important to middle class Peruvians.

Consumers adopt a more conservative attitude towards credit (February 2013)

A nationwide survey conducted during December 2012 by marketresearch firm Datum found that 85% of Peruvians did not intend to take

on more debt during 2013. This follows several years of booming credit:

The outstanding balance of consumer credit in Peru grew by 83% in real

terms between 2007 and 2012, to just over US$2.4 billion, according to

Euromonitor International estimates.

According to Jorge González Izquierdo, an economist at Universidad del

Pacífico, there are three main reasons for this: Families are now “more

aware of the risks of excessive debt,” interest rates are increasing, and

“rising incomes mean that consumers have less need of short-term



credit.”

Migration stories (February 2013)

More than 2.4 million Peruvians left the country to live abroad during

the period 1990-2012, according to data from the INEI, the country's

national statistics bureau. This was largely driven by “the search for a

better life and more income,” the bureau said. This figure represents

around 8% of Peru's total population (30.2 million in 2012). According

to the INEI, the leading destinations for these migrants were the USA

(31.5% of the total), Spain (16%) and Argentina (14.3%).

However, according to Euromonitor International data, Peru's netmigration rate has been falling for several years, declining from 2.2% in

2007 to 1.3% in 2012. Economic difficulties in such countries as the

USA and Spain, as well as rising incomes at home, have been the main

causes of this. One example of this trend is Rocío Pérez Regalado, who

returned to Peru from Spain after her home there was repossessed by

the bank when she could no longer pay her mortgage.

Surging smartphone sales drive app boom (February 2013)

As in most of the rest of the world, smartphones are one of the most

desired gadgets in Peru. According to Euromonitor International

estimates, around 1.5 million smartphones were sold in the countryduring 2012, compared to just over 300,000 feature phones. A survey

conducted by Ipsos Apoyo during late 2012 found that while 75% of

Peruvian adults had a mobile phone, just 15% had a smartphone. 32%

of smartphone owners were found to use these devices to access the

nternet for at least two hours every day.

Most (76%) of them used pre-paid devices, with users topping up their

credit at bodegas (neighbourhood grocery shops), rather than having a

contract. Social networks like Facebook were found to be the most

popular online activity for smartphone users. Meanwhile, an increasing

number of Peruvian businesses, particularly retailers and banks, areaunching apps to target this rapidly growing audience.

More landlines, but fewer calls (January 2013)

According to a report published during December 2012 by the Peruvian

Statistics and Computing Institute (INEI) entitled “Information

Technology and Household Communications,” the number of landlines in

Peru is rising: 30.5% of Peruvian households had a landline during the

third quarter of 2012, up from 30.1% a year earlier. Landlines were

found to be particularly popular in the Lima metropolitan region (where

58% of households had one) and other urban areas of the country

(27.5%). However, just 2% of rural households had one.This growth can largely be attributed to the emergence of a new middle

class in Peru. According to Euromonitor International data, there were

almost 3.3 million telephone lines in use in Peru during 2011, up from

2.6 million during 2006. However, the number of minutes of calls made

on them fell by 18% over the same period, to 5.9 billion. There may be

more landlines, but in general, local consumers are using them less and

their mobiles more.

Rallying the hot new spectator sport (January 2012)

The Dakar Rally, which has been held in Argentina, Peru and Chile since



2009, is captivating Peruvians. For the first time since it came to South

America, the race started in Lima on January the 5th, with 189

motorbikes, 155 cars, 75 trucks and 40 quad bikes participating in front

of thousands of spectators. It will finish in Santiago, Chile, on January

the 20th.

The race provides a significant economic boots to shops, restaurants

and hotels in the cities it passes through. José Silva Martinot, Peruvian

Minister of Foreign Trade and Tourism, estimated that a record one

million people would travel around the country to watch it. “This year,

we will watch the race in two Peruvian cities: Ica and Arequipa,” saidone local, who follows the event with his family. “I never thought I

would enjoy racing, but this is so thrilling,” said a young woman from

Lima.

Clothing top Christmas gift (January 2013)

Clothing beat toys as a Christmas gift in 2012, according to a survey

conducted by market research company GFK during December 2012. It

found that 69% of Peruvians wanted clothing for Christmas, while 59%

favoured toys. Local media interpreted these results as showing that

Christmas was now as much for adults as children.

“Everyone will get something, not just kids – we are getting clothes forourselves and toys for them,” according to Lima resident Fabricio Soles,

who was speaking to RRP Peru. According to the survey, 7% of

Peruvians desired gadgets as gifts, 6% personal care products and 3%

jewellery. Money was not found to be a popular gift option.

Increasingly affluent drivers no longer content with used cars (December 2012)

For decades, used vehicles were the norm in the Peruvian car market,

with vehicles from Brazil, Chile and even the USA imported into the

country. However, this is changing: “Nowadays, 95% of Peruvians would

rather buy a new car,” according to Iván Besich, head of the Peruvian

Car Representatives Association (Araper). According to EuromonitorInternational data, new registrations of passenger cars in Peru surged

from just over 20,000 in 2006 to more than 93,000 in 2011.

Falling prices and the rise of the middle class have driven this change:

Edwin Derteano, head of the Peruvian Car Association (AAP), said that

many Peruvians now had much more purchasing power than previously.

“Some people are going from social segment D to C or from C to B.

Therefore, they have new demands and look for more comfort,”

according to Derteano.

Lady Gaga sells out everywhere, except in Lima (December 2012)

During late November, American pop singer Lady Gaga played to anarena that was less than a third full in Lima. There were just 17,000

fans in the 52,000-seat stadium, according to the Peruvian Songwriters

Association (Apdayc). This was in stark contrast to her other shows in

the region: the Born This Way Ball Tour sold out in Brazil, Chile,

Colombia, Argentina and Paraguay.

According to a report on Radio Programas del Perú, a ticket that

originally cost PEN1,288 (US$490) could be purchased on the night for

just PEN150 outside of the arena. The news of this “failure” spread

quickly through social networks and traditional media, with many airing

their thou hts on the matter. One said that “it was not Lad Ga a's



fault,” rather that “Peruvians prefer other things, such as local music.” A

few said that they did not attend the show due to high ticket prices,

while another claimed that Peruvians “do not like big shows.”

Ají de calabaza exemplifies the new Andean cuisine (December 2012)

Peruvians love cooking, with many national dishes having pre-

Columbian roots. Many get together with friends and family to cook,

recommend recipes to each other and argue about cooking as if it were

a sport. This year, one of the most popular dishes has been ají de

calabaza, which is considered to exemplify “new Andean cuisine” by

some. It is made from potatoes, pumpkin, garlic, red chilli, onions,

beans, cheese and milk. Several restaurants in Lima have added this

dish to their menus this year.

It originated in Arequipa in the south of Peru, where picanterías remain

popular eateries. These are small restaurants with thatched roofs

whose regular customers come every day at noon for a long lunch that

usually consists of spicy food.

Happy Crioween! (November 2012)

Halloween has grown more popular in Peru over recent years, but it has

also become a source of conflict. This is because it coincides with the

day when Peruvians celebrate criolla (Peruvian folk music). This dispute

s largely intergenerational in nature, with older people preferring to

celebrate criolla and younger Peruvians favouring Halloween.

“For years, adherents of these two celebrations have been at

oggerheads. It was very common to hear talk of how someone was

more or less Peruvian due to the fact that they had opted for one

celebration or another,” according to newspaper El Comercio. “However,

peace has now been declared, with the two celebrations united as

Crioween.'” This fusion combines Halloween costumes with national

music instruments. Many shopping centres hold fun events adorned with

black-and-orange decorations and portraits of Peru's greatest musicians.

The young party, while the old disapprove (November 2012)

Young Peruvian consumers are now less austere and more hedonistic

than previous generations. “The younger the consumer, the greater the

preference for hedonism. Young people care about their status and their

social life. On the other hand, older people are generally far more

conservative and austere – their aim is to save,” said Hernán Chaparro

of research firm GfK Conecta.

He added that many younger Peruvians preferred products that offered

entertainment, were indulgent or reinforced their social status.

According to Chaparro, young people are seeking “original experiences”

and “services related to leisure and entertainment,” which should fuel

the growth of shopping malls in Peru. “One word defines today's youth –

arrogance,” said one 57-year-old man with a 15-year-old son.

Where street food is king (November 2012)

39% of Peruvians usually eat on the street “several times a week,” a

survey conducted by McCann Worldgroup during late 2011 and published

n November 2012 has found. 67% of respondents were of the opinion

that eating on the go “is not harmful.” “Those who eat here do not get

sick,” “what's truly unhealthy is being hungry,” and “hot oil kills germs”



were among the comments attributed to respondents. Two thirds of

them thought that street food was as tasty as their mother's cooking.

In Lima, the most popular street foods are salchipapas (sausages with

French fries), ceviche, kebabs, sandwiches and chicken. According to

Euromonitor International data, the value sales of street stalls/kiosks in

Peru grew by 7.5% in 2011, to US$1.44 billion.

Tourists go online (October 2012)

A growing number of Peruvians are researching their travel plans,

comparing prices and making bookings online. Moreover, they are

ncreasingly doing this for short domestic trips, as well as for long-haultravel. According to travel firm Atrápalo.pe, for the Feast of Santa Rosa

de Lima, which fell on August the 30th this year, its sales rose by 68%

over the previous year, with sales of one-day packages to destinations

close to Lima surging by 275%. “A majority (55%) still pay via bank

transfer, but the use of credit and debit cards is growing fast (45%) ” ,

said Greta Armestar of Atrápalo.

A third lack health insurance (October 2012)

According to the latest National Household Survey, which was conducted

during the second half of 2011 by Peru's national statistical body, the

INEI, 36% of households were not covered by medical insurance. In fiveregions (including Lima), this figure was higher than 40%.

The survey found that 36% had access to healthcare through the

country's Health Insurance System (SIS), which is supposed to act as a

safety net for the poorest Peruvians, while 24% were covered by

EsSalud, which is provided via employers. Just 2% of respondents had

private insurance, while another 2% had access to healthcare services

provided by the police or the armed forces. The survey also found that

36% of Peruvians suffered from chronic diseases and that 46% did not

seek treatment when they were ill.

Migration slows as economy booms (October 2012)

With the Peruvian economy growing strongly (real GDP growth stood at

6.9% in 2011), the number of Peruvian migrants is declining, although it

remains significant. According to Euromonitor International data, net

migration to Peru fell every year between 2006 and 2011, from -66,300

(a net migration rate of -2.4%) to -44,800 (-1.5%).

However, the emigration of skilled workers remains a worry for the

government. According to the Parliament of the Andean Community of

Nations, 735,234 Peruvian “professionals and technicians” were living

abroad in 2011. The government is currently working on strategies

aimed at enticing them back to Peru.Number of luxury consumers surges (September 2012)

Strong economic growth in Peru (real GDP expanded by 6.9% during

2011) is fuelling rapid growth in the number of high-net worth

ndividuals. According to data from consultancy Wealth-X, there are now

at least 25,000 Peruvians with a net worth of at least US$1 million, and

t predicts that this number will double within five years, fuelling strong

growth in demand for luxury goods. Wealth-X also found that 775

Peruvian families had bank account balances of more than US$30

million.



Debate highlights water quality and supply issues (September 2012)

Access to clean water is a hot topic in Peru, with the National

Agreement (a forum where the participants include political parties,

representative groups and individual citizens) recently discussing the

question of water resources. During the debate, it was claimed that ten

million Peruvians did not have ready access to water at home, with

many more only having access to water that was not of sufficient

quality to be used for drinking, cooking or bathing.

It was pointed out this that led to an increase in the consumption of

carbonated beverages (as an alternative to tap water) and canned fruitsand vegetables (which unlike fresh ones, do not have to be washed

prior to consumption) in these households.

Survey finds rising stress levels (September 2012)

A survey conducted by HR consultancy Regus during early 2012 has

concluded that many Peruvians are too tired or stressed after work to

go to exercise or even eat out. The global survey found that 33% of

Peruvian respondents said that their stress levels had risen over the

past year. Work (61% of respondents) and personal finances (47%)

were found to be the leading causes of stress.

Small towns get wired (August 2012)

According to government data, around 3,600 small towns in Peru have

been connected to the outside world via mobile phones masts and fibre

optic cables for the first time over the past twelve months, providing

hundreds of thousands of people with access to telecommunications for

the first time in their life. According to Carlos Paredes, the Peruvian

communications minister, while some of these villages were already

using satellite or microwave technology to connect, “fibre optics will

make it much simpler to implement electronic government programmes

n such areas as health and education.”

All that one resident from a small town in the country's southern regioncould say was “Joy, joy” as Spanish firm Telefónica installed the first of

two mobile phone antennas locally. Annual volume sales of mobile

phones in Peru doubled from 2.7 million units to 5.5 million units

between 2006 and 2011, according to Euromonitor International data.

Survey highlights influence of teachers (August 2012)

A survey conducted by employment website Trabajando.com in Peru

during June 2012 has found that teachers are among the most

nfluential figures in Peruvian society. 91% of Peruvians said that their

teachers had “a large impact” on their lives. 41% even said that their

teachers had a bigger influence on their lives than their parents. Thesurvey also found that almost half of respondents (46%) were still in

contact with their old teachers.

Security the top concern for shoppers (August 2012)

According to a survey conducted by Arellano Marketing during May and

June 2012, “large discounts” and “affordable prices” are no longer what

Peruvian consumers are most concerned with when they visit a shopping

centre. Instead, “security” is now their top priority. The survey also

found that shoppers were eager to see such services and amenities as

theatres, medical services, nurseries and discos added to shopping



malls. On the other hand, they were not particularly interested in more

restaurants and food courts, as there are already plenty of these.

Bringing banking to the deepest jungle and the highest mountain (July 2012)

The Central Reserve Bank of Peru and the country's navy have launched

a campaign to use mobile banks to bring financial services to 167

remote communities in the Amazon and Altiplano regions, where

banking services are currently “non-existent,” according to local media

reports. The goal is to provide banking services to the 1.3 million

people inhabiting these regions, and the navy's role is to help transport

equipment and personnel into remote regions where roads are oftennadequate but rivers are plentiful.

This launch of this scheme followed a successful pilot programme that

saw thousands of people gain access to banking services for the first

time in their lives. This represents a continuation of the strong growth

experienced by the country's banking sector over recent years: According

to Euromonitor International estimates, the number of financial cards in

circulation in Peru increased by just over 50%, to 18.5 million, between

2006 and 2011.

Government push for healthier eating habits (July 2012)

Many Peruvians have poor eating habits, according to Héctor Velarde, agastroenterologist at the Clínica Ricardo Palma in Lima. He says that

“more than 40% of Peruvians suffer from acid reflux or heartburn due to

eating habits that irritate or damage the oesophagus.” This problem is

exacerbated by the fact that many Peruvians are lactose intolerant or

sensitive to spicy foods.

Since January 2012, the Ministry of Health has been leading a campaign

to improve local eating habits. “The idea is to reach Peruvians on every

front so that they begin to change their habits, adopting healthier diets

and eating schedules,” according to an unnamed ministry official, who

was speaking to Andina, a local news agency.Getting patriotic about cocoa (July 2012)

Peruvian farmers are celebrating a record cocoa crop: According to

Euromonitor International data, the country produced 50,300 tonnes of

cocoa during 2011, up from 46,600 tonnes in 2010 (itself a record) and

almost double its 2005 output of 25,300 tonnes.

However, some are wondering why more of it is not being consumed

domestically: According to the Ministry of Agriculture, over 90% of

Peruvian cocoa is exported. “Peruvian cocoa is highly popular

everywhere but here - why?” wondered one Twitter user. Another simply

said “Long live Peruvian cocoa!” Some now talk of “patriotic cocoa fever”among both consumers and producers. Meanwhile, a Cocoa and

Chocolate Hall has been opened in Lima to showcase the industry, while

theobroma cacao (the cocoa tree) has been declared part of the

“national heritage of Peru” by the government.

Reduction in poverty gives birth to “new consumers” (June 2012)

According to the Peruvian Institute of Statistics (INEI), the rate of

extreme poverty in the country declined from 7.6% to 6.3% between

2010 and 2011. This implied that 362,000 Peruvians were no longer in

extreme poverty. Local media have dubbed them “new consumers.”



However, according to Alejandro Vílchez of INEI, there are still 1.9

million Peruvians living in extreme poverty. They are concentrated in

rural areas, where 205 per 1,000 inhabitants still live in extreme

poverty, compared to just 14 out of 1,000 in urban areas. 56% of those

n extreme poverty work in agriculture, fishing or mining, according to

INEI.

Rural dwellers happier than urbanites (June 2012)

A report on wellbeing published by the National Institute of Mental

Health in June 2012, which based on data collected over the course of a

decade, has found that those living in smaller urban areas or in thecountryside tend to be happier than their counterparts in large cities.

The regions with the highest proportion of respondents who claimed to

feel happy “always or almost always” were the mainly rural ones of

Chimbote (79.5%), Tarapoto (77.9%), and Tumbes (76.5%). On the

other hand, urban areas like Tacna (58.7%), Ayacucho (60%), and Lima

(61%) had the lowest proportions of “happy” people. Substance abuse

s thought to play a role in this, with the report arguing that “Addiction

s related to opportunity, and you have more opportunities to drink

alcohol in urban areas.”

Young workers aspire to entrepreneurship (June 2012)

A survey conducted in February 2012 by the Peruvian Youth Secretariat

(Senaju) has found that many young Peruvians harbour entrepreneurial

ambitions: 31% of those surveyed (who were aged between 15 and 29

years of age) said they “intended to open a business within the next

twelve months.”

According to Senaju, the entrepreneurial zeal of these young people

may be related to the fact that many of them have had a “rough” start

to their careers and are in poorly paid positions with no social security

benefits. This trend towards entrepreneurship is helping to drive sales

of such consumer durables as computers and mobile phones, as well asservices aimed at small businesses, such as broadband internet access.

Junk-food marketing blamed for the poor eating habits of school children (May 2012)

More than half (54%) of all students attending Peruvian public schools

(at both the primary and secondary level) drink at least one soft drink

every day, according to the Ministry of Health's Survey on School

Healthcare. Just one third of respondents were found to eat fruit at

east twice a day, with 11% eating fast food at least three times a

week. The study, which was published in May 2012, was conducted

during 2010. The study also found that 20% of students were

overweight, while 3% were obese.Many claim that children (particularly those from low-income families)

are eating too much processed food, while others point to the heavy

marketing of junk food: A study conducted during late 2011 by

consultancy Perú-Concortv found that 66% of all TV advertising shown

before 10pm was related to junk food, exposing the average child to 22

minutes of such marketing daily.

Consumers flock to cheap chicken (May 2012)

As in much of the rest of Latin America, inflation has traditionally been

a significant worry for Peruvian consumers, making recent falls in the



price of chicken (a Peruvian staple) particularly welcome for local

families. During early May, the price of chicken fell to a three-year low,

according to the Peruvian Poultry Farming Association (APA).

Some are trying to make the most of the price drop by buying in bulk.

“The price of chicken is always fluctuating. Now we are in a period of

ow prices, and housewives are seizing the opportunity to buy more

chicken,” according to the APA's Pedro Mitma. “I have a large freezer

with more than ten full chickens,” according to one poster on the

website Peru.com.

Fog catchers used to fight water shortages (May 2012)

Thousands of Peruvian families are using an innovative and cheap

technology called a “fog catcher” to cope with a severe shortage of

water. Introduced to Peru by a group of German students a few years

ago, they are “starting to bear fruit” on the outskirts of Lima and in

other areas facing serious water shortages, according to news portal

RPP.

Fog catchers are special nets that are strung up in areas prone to cloud

or fog. The Peruanos sin Agua (Peruvians without Water) movement is

teaching people how to set them up and use them. Many families are

also being helped in this regard by local government, and in some casesthey are sharing special filters to make the water potable. Currently,

there are thought to be around 200 fog catchers in operation

nationwide.

Asian marques benefit from booming automotive demand (April 2012)

Sales of new cars rose at an annual rate of 35%, to 44,345, during the

first quarter of 2012, which was a record, according to data from the

Peruvian Association of Car Dealers (Araper). More than two thirds of all

these cars were Asian marques. Toyota was the biggest selling marque,

accounting for 16.3% of all sales, followed by Hyundai (14.1%), Kia

(10.7%) and Nissan (9.4%). The biggest-selling non-Asian marque wasChevrolet (8.3%).

“When Peruvians think of cars, they see a Japanese car. This concept

has gradually expanded to include other Asian countries, especially

Korea and now China as well,” according to a 25-year-old Peruvian

student living in Argentina. Price is also a factor: Thanks to a trade

agreement between Peru and Japan, Japanese cars are usually cheaper

than the competition. Strong cultural links between Peru and Japan also

play a role– Peru is home to one of the largest Japanese communities in

the world.

Internet retailing going mainstream (April 2012)

It seems that Peruvians are losing their fear of shopping online. “15%

of Peruvians shop online,” according Edmundo Cavalli, head of local

consultancy Cavalli Bureau-Estrategia y Negocación. “Sales are

ncreasing exponentially,” he added. Based on data from such retailers

as Carrefour and Wal-Mart, Cavalli reckons that the figure may rise to

20% or even 30% within a few years. Online shopping in Peru is driven

by young consumers, according to Cavalli, “because they consider

shopping at stores a waste of time.”

This growth is mainly being driven by increased purchasing power,

better internet access and the fact that local consumers are becomin



more comfortable spending online, according to newspaper Gestión.

According to Euromonitor International data, internet retailing in Peru

was worth US$57.4 million in 2011, having doubled in real terms during

the period 2006-2011.

Consumers lose appetite for US dollars (April 2012)

As in most Latin American economies, where inflation and devaluation

are usually persistent worries, American dollars tend to be the currency

of choice for savers, borrowers and investors in Peru. Even credit cards

and mortgages tend to be dollar denominated. The dollar's importance

s so great that it accounts for 44% of all money in circulation in the

country, according to the newspaper La República.

However, “An increasing number of Peruvians are losing their fondness

for the dollar [due to its falling value against Peru's neuvo sol] and now

prefer to save and borrow in local currency” , the paper said. According

to Enrique Arroyo, head of the Peruvian Bank Association, “There is

tendency towards de-dollarisation in the financial system.” One of the

other reasons behind this change is the fact that local interest rates are

falling.”

Most clothes buyers favour domestic fashion (March 2012)

A survey of clothes shopping habits was conducted during December

2011 by consultancy Directo Perú on behalf of the National Industry

Society (SNI). It found that the most popular place for clothes shopping

n Lima was the Gamarra district, followed by the Chilean department

stores Ripley and Saga Falabella. 27% of respondents admitted taking

nto account global fashion trends when shopping, while 37% said they

based their choices on discounts. 59% of men and 68% of women said

they favoured domestically produced clothing over imported products.

More drivers switching from petrol to LNG (March 2012)

In the face of rising petrol prices, a growing number of Peruvian drivers

are converting their vehicles to use liquefied natural gas (LNG). Over

the past decade, Peru has become a significant producer of natural gas,

and the government is increasingly promoting its use. According to

Jorge Merrino, minister of energy and mining, drivers who convert to

LNG “can stop worrying about what goes on in the world with regard to

oil prices.”

“Taxi drivers with gas-powered cars do not feel the impact of oil price

ncreases— why should I?” said one 50-year-old man who had recently

converted his car to LNG. With electricity prices rising, a growing

number of households are also seeking to connect to the country's

natural gas network, and department stores are increasingly stockinggas cookers, rather than electric ones.

Rise in remittances likely to boost d iscretionary spending (March 2012)

Remittances sent home by Peruvians living abroad totalled US$2.7bn in

2011, up 7.8% on the previous year, according to Euromonitor

International data. A decade previously, this figure stood at just over

US$750 million. Remittances are generally regarded as discretionary

ncome by Peruvians, who tend to spend them on non-essential items,

such as consumer durables, as well as on home decoration and repairs,

rather than saving them. They also boost spending on travel, cultural



goods and communications, according to Peru's central bank.

Native furs back in fashion (February 2012)

Formerly regarded as old fashioned, particularly by younger consumers,

clothing made from camelid fur is now growing in popularity in Peru, and

the coming winter season is predicted to see a further increase in

demand for textiles made from vicugna and alpaca fur.

“It is not just the fur, but also the tailoring process. Today's

vicugna/alpaca-fur tailoring follows millennial traditions, a fact that is

ncreasingly appreciated by Peruvians,” according to a report on Lima-

based Radio Capital. The products most commonly made from thesematerials include blankets, sweaters, scarves, body warmers, stockings

and jackets, with Perú Quiri, Navale and Michell among the most

popular brands.

Peruvians declare war on writer critical of local cuisine (February 2012)

When novelist Iván Thays criticised Peruvian cuisine on his blog, Vano

Oficio, claiming it was “indigestible and not very healthy” and “a symbol

of a sociologically fragmented country,” his blog and twitter accounts

were swamped by a wave of complaints from outraged Peruvians. He

was also attacked on television and radio programmes. Thays also

criticised Peru's ongoing gastronomy boom, claiming that it was a“marginalising factor that breeds the worst kind of nationalism.”

Such comments as “If he does not like it, he should shut up - no one

asked him for his opinion;” “He is as expert in cuisine as in nuclear

engineering… he knows nothing;” and “millions of people around the

globe love our food, and they can't be wrong,” were typical of the

feedback he received from his countrymen. This row underlines how

Peruvian cuisine has become an integral part of the country's culture

and identity.

Consumer credit boom creates problems for younger borrowers (February 2012)

Consumer credit is booming in Peru, expanding by 19.6% in real termsduring 2011, to US$4.9 billion, according to Euromonitor International

data. However, the increased indebtedness of young Peruvians is a

growing cause of concern for some. According to Óscar Banda from

research agency Sentinel, those aged under 25 years are much more

ikely to run into problems with indebtedness. Writing in newspaper Los

Andes, he said that young consumers were not financially savvy and

were racking up debts buying clothing and electronic gadgets. He also

said that aggressive marketing strategies from banks and other lenders

were partly to blame for this. “This increase in the number of young

debtors may turn them into a financially excluded class in the long run, ”he added.

Too much violence and discrimination on television (January 2012)

According to a survey conducted by the Consultative Council on Radio

and TV (ConcortTV) during September 2011, the vast majority of

Peruvians agree that there is “too much violence” (89% of respondents)

and “discrimination” (81%) on television. 63% agreed with the notion

that TV portrays women negatively, while 65% and 55% thought it did

the same for children and the elderly, respectively.

“It is always the same, whether it is the news, series or films:



Television depicts violence, sex or foul language. It is not something I

want my children to watch,” according to 29-year-old Amanda. 85% of

respondents said they controlled what their children watched, while

91% said they did not allow them to watch TV after 9pm. 82% said

they usually watched TV with their families. The most popular

programme types were found to be news bulletins (favoured by 65% of

respondents), films (57%), series and soap operas (47%),

entertainment shows (23%) and children's programmes (13%).

Private healthcare on the rise, but with enough room to keep growing (January 2012)

According to a report published by the National Institute of Statistics(INEI), 65.9% of Peruvians have access to some form of healthcare

coverage, either public or private. According to “Life Conditions in Peru,”

n the third quarter of 2011, 37.9% of Peruvians had healthcare services

provided by the Comprehensive Healthcare Insurance (SIS), while 22.2%

had EsSalud. While the former is government mandated, the latter is

operated by private insurance companies.

Peru's recent spurt of economic growth has fuelled demand for private

nsurance. “I pay up to US$800 a month for my healthcare insurance,

but I only have it since last year. Previously, it was not available in my

region,” according to one unnamed executive with a multinational firm.Previously, most of those with private insurance worked for

multinational companies, but a growing number of high-income

Peruvians, particularly in Lima, are now availing of it.

How many are smokers? (January 2012)

According to Euromonitor International data, sourced from the country's

Ministry of Health, the smoking rate among Peru's adult population has

declined slightly over recent years, from 20.3% in 2005 to 20%.

However, a report published by the INEN (Institute of Neoplastic

Illnesses) Anti-tobacco Committee claims that there are actually five

million, rather than four million (as implied by a rate of 20% among thecountry's adult population), smokers in the country.

The figures diverge because the latter estimate includes underage

smokers and what the INEN estimates to be half a million “secret

smokers.” In total, about ten million Peruvians have had some

experience of smoking at some point in their lives, the INEN claimed.

Beer consumption surges (December 2011)

Per capita consumption of beer in Peru is now at a record level,

according to the Gestión newspaper. “We started to drink beer along

with pisco (a type of gin) at night, but also on weekends at home,” said

Franco, a 25-year-old living in Lima. He added that his father used toconsider beer to be “childish” but that he was now drinking it as well.

According to Euromonitor International data, Peruvian per capita beer

consumption (among those aged 15 years or older) rose from 59.8 litres

to 64.3 litres between 2010 and 2011, having stood at just 45.7 litres

as recently as 2006. Peruvians are now bigger beer drinkers than

Argentines (average per capita consumption of 62 litres in 2011) and

Colombians (51.5 litres).

Survey highlights holiday habits (December 2011)

An online survey conducted by MercadoLibre.com and market research



firm OH! Panel during September and October 2011 found that around

eight out of ten Peruvians will choose a domestic destination for their

2012 holiday. “To rest, there's nothing better for a Peruvian than

staying in the country - going to the beach or the mountains and saving

money,” according to Gladys, a 30-year-old Peruvian who lives in

Buenos Aires.

Staying in a hotel was found to be the most popular option, favoured by

46% of respondents. Just 11% favoured renting private accommodation,

such as an apartment or a chalet. 67% said they took their main

holidays in January or February, with 13% holidaying in December. 39%said they would take no more than a week off, 37% a fortnight and

13% a full month. 70% said they favoured beach holidays, with 24%

opting for the mountains. 41% said they intended to holiday with their

families, 27% with their partners and 13% with friends.

Credit card use grows (December 2011)

The number of credit cards in use in Peru is rising steadily, increasing

from 3.2 million to 3.4 million between 2010 and 2011, according to

Euromonitor International data. As recently as 2006, this figure stood at

just 2.1 million. “This growth is due to the increased use of cards, not

just for financing purchases, but as an alternative to cash,” according toAsbanc, the trade association of the country's banks.

However, a survey conducted in eight cities by the Superintendent's

Office for Banking and Insurance during September 2011 found at least

a third of those interviewed did not understood what an “interest rate”

was. “34% answered wrongly, and 26% did not give an answer,”

according to the regulator.

Book sales boom (November 2011)

Peruvian parents are increasingly buying their children books, something

that was previously regarded as “an unaffordable luxury,” by many.

According to trade group The Peruvian Book Chamber, children's booksales are set to rise 15% during 2011. Lilian Minaya, head of the

chamber, said the boom in sales of children's books was partly down to

the fact that local bookshops were now stocking more of them.

These books are increasingly being published locally, with such Andean

characters as “el Cholito” and animals like llamas, guinea pigs or furless

Peruvian dogs prominent. According to Euromonitor International data,

consumer expenditure on newspapers, magazines, books and stationery

n Peru grew by 15.3% in real terms between 2005 and 2010, to US$251

million.

Fear and loathing in Lima (November 2011)

Feeling of insecurity have an important impact on commerce and

ifestyles in Peru, as they discourage consumers from going out to

restaurants in some areas and increase the attractiveness of self -

contained shopping centres. A survey conducted by Ipsos Apoyo during

October 2011 has found that 87% of Peruvians regard going to sports

events as “unsafe.” 91% were of the opinion that the best way to

reduce violence was to stop fans with a previous history of violence

from entering grounds. The survey found Lima to be the country's most

nsecure place, followed by northern cities Trujillo and Chiclayo, while

Cuzco was regarded as the most secure. 65% of respondents agreed



with the contention that Peruvian society was violent.

The poll was conducted in the wake of the death of an Alianza Lima

football fan during late September: He was thrown to his death during a

match against local rivals Universitario. The death, which occurred at

the Estadio Monumental in Lima, was particularly shocking to Peruvians

because the victim, 23-year-old Walter Oyarce, was watching the game

from a VIP box, well away from most fans. Increased violence at

football grounds has encouraged a growing number of fans to stay away

and watch games on TV instead, boosting demand for cable television,

among other things.Peruvians discover cruises (November 2011)

Not long ago, it was almost impossible to find a Peruvian who had

taken a cruise, but this is now changing rapidly. In 2010, the domestic

cruise market was worth US$5 million, according to market data

published by broadcaster Terra, with Peruvians travelling as far afield as

North America, Europe, Asia and Oceania.

While overall demand remains somewhat limited, it is growing at a

rapid pace. According to Fernando Campodónico, general manager of

Peruvian Net, which represents three cruise lines in Peru: “We have

been growing at an annual rate of 100% over the past three years.”“Those who go on a cruise tend not to be inexperienced tourists, but

people who have already travelled and are looking for new experiences,”

he added.

Junk food blamed for youth obesity (October 2011)

A survey conducted during 2010 by the Ministry of Health found that

20% of school children and university students were overweight,

blaming this on “bad diets.” According to the survey, one in ten ate junk

food three or more times a week, while almost half of them regularly

consumed soft drinks.

However, the older members of this cohort do appear to be taking moreexercise. According to website Peru21, gyms and sports centres are

rapidly growing in popularity, mainly due to an influx of young people.

University students account for a quarter of all their clients, according

to the website. Attendance triples with the arrival of spring, as

youngsters strive to get into “beach body” shape.

Everybody is talking about Gamarra (October 2011)

Located in Lima, Galarias Gamarra is Peru's main shopping area for

clothing. It boasts a staggering 14,000 clothing shops, many of them

ow-cost, making it particularly attractive to low- and middle-income

households. It is not unusual for entire families to take a trip to Limajust to visit it and stock up on clothes for the coming season.

Following a recent government-led redevelopment, it now also offers

restaurants, coffee shops and banks. More importantly, what had

previously been a chaotic, dirty and insecure environment now looks

very much like a large shopping centre in any other part of the world,

with proper security and adequate parking. As a result, it is now

attracting more high-income consumers, many of whom now profess “to

ove” a place they “were previously afraid of ” on social networks like

Twitter. A growing number of tourists are also visiting the area.



Many savers prefer the mattress to the bank (October 2011)

Peruvians do not appear to trust banks and other financial institutions

very much. According to a study conducted by government regulator the

Superintendence of Banks, Insurance Companies and AFP (SBS) and the

Universidad del Pacífico during early 2011, more than a third (35.4%) of

Peruvians keep their savings “under the mattress,” a popular practice

throughout Latin America.

29.5% of respondents used banks for saving, while 6.9% of

respondents use “ juntas,” which are local organisations that provide an

nformal way of saving. However, some juntas are little more thanotteries. The rest (23.3%) do not save any money at all. According to

the study, many Peruvians “mistrust” banks or are “simply not seeing

the advantages of opening a bank account.”

Gastronomy boom (September 2011)

Food is an essential part of Peruvian identity. “Through our cookery, we

reveal our idiosyncratic features, where we came from and who we are,”

says Alfredo Perret, head of the subcommittee of gastronomy of the

Chamber of Commerce of Lima (CCL). It also has great economic

significance: According to Arellano Marketing, gastronomy accounts for

13% of the country's GDP. According to The National Institute ofStatistics (INEI), during the first half of 2011, the restaurant sector

grew by 9.3% in year-on-year terms, with roast-chicken and fast-food

chains performing particularly well.

“It is a boom. We have more than 80,000 young people studying

cookery, and 95% of those who graduate quickly find a job,” says

Nicolai Stakeeff, former president of the subcommittee. Perret claims

that “we are seeing improvements in food preparation techniques and

fostering awareness about the proper handling of ingredients,” due to

pressure from consumers, who he says are becoming “increasingly

demanding.”

Nearly half want a new job (September 2011)

According to a study conducted by the employment website

Trabajando.com between May and July 2011, nearly half (45%) of

Peruvians would change their job if they could. 55% of those surveyed

claimed they would not change their profession. “Almost half of

Peruvians would choose a different life,” as a presenter at Lima-based

Radio Comas put it. Many also claimed to have been let down by the

country's education system, with 60% of respondents claiming that “it

had not exploited their full potential.”

Social networking tops with internet users (September 2011)

A report published by ComScore in September claims that Peruvians

“devote 65% of their time online to entertainment and social

networking” and that most of them spend this time using such networks

as Facebook and Twitter, rather than checking their e-mails. The report

was based on a survey conducted during July and August 2011.

According to the research, social networks were used by 92% of

respondents, while 85% used e-mail and 75% used instant messaging.

The survey also found that 82% of Peruvian internet users downloaded

multimedia content. Other popular types of websites were travel (31%),

entertainment (64%) and news (46%). Many Peruvians also visit retail



(57%) and banking (39%) websites. According to Euromonitor

International data, the number of internet users in Peru more than

doubled between 2005 and 2010, to 10.1 million.

Where chicken is king (August 2011)

Pollo a la Brasa (also known as Peruvian Chicken or Charcoal Chicken), a

simple, traditional dish, is hugely popular in Peru. In 2004, it was

recognised as a “special Peruvian dish,” and it even has its own day -

the third Sunday in July (July the 17th in 2011) is Pollo a la Brasa Day.

According to the Ministry of Agriculture, nearly two million chickens were

consumed on that day at “chicken stores” (specialist stores that only

sell chicken and chicken products), restaurants and at home. “People

who go out to eat prefer chicken stores to chifas (outlets selling

Chinese food) or those selling ceviche (another popular dish). Chicken is

the mainstay of Peruvian cuisine,” said Víctor Noriega of the Ministry of

Agriculture. According to Euromonitor International estimates, per

capita consumption of chicken in Peru stood at 13.3kg in 2010,

compared with 6.4kg of beef and veal and just 1.9kg of pork.

Stronger economic growth leads to reduced migration to Chile (August 2011)

The first decade of the millennium was marked by significant Peruvian

migration to Chile. In 2010, there were 138,525 Peruvians living in

Chile, according to Chilean government data, with more than half of

them working in the domestic service, construction and commercial

sectors. However, according to the Chilean Ministry of Interior, the

Peruvian community in that country increased by just 6% in 2010,

having expanded by 22% in 2009.

The Chilean government attributed the decrease to an improved

economic environment in Peru: According to Euromonitor International

data, the annual rate of real GDP growth in Peru surged from 0.9% to

8.7% between 2009 and 2010. However, overall net migration from Peru

declined only marginally (from 54,000 to 50,000 between 2009 and2010), which suggests that Peruvian migrants are going elsewhere,

rather than remaining at home.

A Who's Who of Peru's cultural exiles (August 2011)

Newspaper El Comercio runs an influential weekly piece entitled

“Las10+” (“The Top Ten” ), which ranks various aspects of Peruvian

culture based on reader input. As the annual celebration of the country's

ndependence (July the 28th) grew near, it ranked “the ten most

mportant Peruvian artists abroad” during mid July.

Among the artistic luminaries featured were Nobel Prize-winning writer

Mario Vargas Llosa, fashion photographer Mario Testino, film directorClaudia Llosa, actor Christina Maier and painter and sculptor Fernando

de Szyszlo. Other choices included tenor Juan Diego Flórez; Susana

Baca, a leading figure in African-Peruvian music and a Latin Grammy

winner; singer Eva Ayllón; musician and ecologist Pedro Suárez Vértiz;

and Gian Marco, a composer of pop songs.

However, the newspaper noted that these “ambassadors” tended not to

be as prestigious in Peru as they were abroad. An internet forum poster

commented that “No one is a prophet in their own land.”

Quality becomes more of a factor in purchasing decisions (July 2011)



Peru's strong economic performance over recent years has begun to

have an impact on local shopping habits. In the past, price ruled, but it

has now taken a backseat to quality for the swelling ranks of the

country's middle class. According to Peru21, a news portal, the new

motto of the Peruvian consumer is “Cheap becomes expensive,”

particularly in relation to clothing and household goods.

In recent years, consumers “have stopped checking prices before

purchasing a product or service,” according to Gonzalo Ansola, head of

the Peruvian Shopping and Entertainment Centre Association. He says

that Peruvians now focus on quality, regardless of price: “Peruvianconsumers are well informed and are willing to spend more for

something durable,” he adds. Hans Eben, CEO of Unilever Peru, says:

“In some sectors, people pay up to 10% more.” In such sectors as

personal care, he maintains that consumers are increasingly prepared to

pay extra for products with “added value.”

Dairy industry wakes up to issue of lactose intolerance (July 2011)

64% of Peruvians are lactose intolerant, according to a study conducted

during 2010 by researchers at the Faculty of Medicine of the Universidad

de San Marcos in Lima. Peru is quite an ethnically diverse country by

Latin American standards, and for some ethnic groups (particularlyAsians), this figure can approach 100%. For many years, this issue was

gnored by the dairy industry, but many producers have now begun to

aunch milk, cheese and yoghurt products aimed at those who are

actose intolerant.

Consumers warm to corporate sector (July 2011)

According to a report called RepTrak Pulse Peru 2011, which was

published by the Reputation Institute and Inmark Peru, Peruvian

consumers are now more trusting of companies. The Pulse index

measures the trust, respect and overall impression of companies by

consumers. The average score (out of 100) of the index's ten leadingPeruvian companies jumped by 4.43 points between 2010 and 2011.

The leading Peruvian companies were found to be Grupo Gloria (with a

score of 83.99), a holding company involved in everything from dairy

products to cement; media company RPP (81.70) and supermarket chain

Wong (78.35). In general, Peruvians tend to favour indigenous

companies over multinationals. Some notable performances from

multinationals included Visa (77.99), Kraft Foods (75.72), Nestlé

(75.60) and The Coca-Cola Co. (74.77).

High hopes that the migration tide will turn next year (June 2011)

Most Peruvian families have at least one member living abroad, withthe USA, Spain, Argentina and Chile among the most popular

destinations. In 2010, the government estimated that the number of

Peruvians residing abroad doubles every ten years. Currently there are

about four million Peruvians living abroad, 90% of whom are aged

between 15 and 49 years.

Migrants have been a hot news topic recently due to their key role in

Ollanta Humala's successful presidential campaign, with 750,000

Peruvians voting for her from abroad. The country's new president hopes

that the economic boom currently being experienced by Peru will allow

many of them to come back. Indeed, it is hoped that next year the



number of returning migrants will at least match the number of

departures for the first time in many years.

The new middle class - thriving, but vulnerable (June 2011)

The expansion of the Peruvian middle class has been a major driver of

the country's economic growth over recent years. However, a report

published by BBVA Research describes this new middle class as

“vulnerable,” since 80% of them still work in the informal sector of the

economy. According to David Tuesta, head of pensions and financial

markets for BBVA Research, most of them have no pensions, as they do

not make social insurance contributions. Moreover, they must pay fortheir own healthcare. However, according to one 23-year-old man from

Lima who has just started his first job: “If you do have a job, there's

nothing to complain about, even if it's not the best one.”

Peruvians show no love for pork (June 2011)

Five years ago, the Peruvian government and trade associations set

themselves a daunting task: convincing consumers that pork was just

as good as, or even better than, other types of meat. However, they

have been quite unsuccessful in this regard. Peruvians still have the

second lowest consumption level in the whole of Latin America (ahead

of Colombia), with per capita consumption of just 1.9kg per annum in2010, according to data from Euromonitor International. In contrast, per

capita consumption of pork in Chile stood at a whooping 15.6kg during

the same year. According to one local consumer, “there are many myths

n Peru that spoiled pork can cause death or that it is pure fat.” He

added that another factor is that pork production is considered by many

to be poorly regulated.

© Euromonitor International 2014

Peru Country Pulse

Documents

Transcript of Peru Country Pulse