Country Profile
From The Report: Peru 2016
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Buoyed by high commodity prices and market-friendly policies, Peru has been one of the best-performing and most stable economies in Latin America over the past decade. Rapid economic growth has, in turn, spurred an emerging middle class and notable social gains, with the poverty rate falling by more than half from 2004 to 2014. Today the challenge facing Peru, as well as other commodity-driven economies in Latin America, is how to diversify its economy, ensure inclusive economic growth and sustain years of poverty reduction amid falling demand for commodities. Since coming to power in mid-2011, President Ollanta Humala has tried to maintain a balance between the expectations of the middle class, business leaders, foreign investors and the demands of local communities in Peru’s mineral-rich areas, with varying degrees of success. As the country heads to the national election in April 2016, economic recovery and anti-mining protests are likely to remain top issues in the country’s political agenda. This chapter contains a viewpoint from President Ollanta Moisés Humala Tasso, and interviews with Ana Maria Sanchez Vargas, Minister of Foreign Affairs; and Jorge Familiar, Vice-President for Latin America and the Caribbean, World Bank.

Articles from this Chapter

Overview

A balancing act: Ensuring inclusive growth amid falling demand for commodities is Peru’s main challenge
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Buoyed by high commodity prices and market-friendly policies, Peru has been one of the best-performing and stable economies in Latin America over the past decade. Rapid economic growth has, in turn, spurred an emerging middle class and notable social gains, with the number of Peruvians living in poverty falling by more than half in the period between 2004 and 2014. Economic Challenges Today, the challenge facing Peru, as well as other commodity-driven economies in Latin America, is how to diversify…

Viewpoint

Towards inclusive growth: President Ollanta Moisés Humala Tasso, on Peru’s development
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Today, the Peruvian economy is recognised as strong. This has been possible because in recent years we have implemented coherent, sustained and inclusive policies. In nearly two decades, Peru has managed to triple its real GDP, maintain low inflationary levels – at around 2% per year – reduce public debt, reach net international reserves equivalent to 30% of GDP and maintain a level of “country risk” below the regional average. This has been possible thanks to the efforts of the entire country,…

Interview

Strengthening ties: OBG talks to Ana Maria Sanchez Vargas, Minister of Foreign Affairs
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Interview:Ana Maria Sanchez Vargas How can the Pacific Alliance (PA) and Mercosur enhance cooperation, and how does the PA’s new legal framework relate to the Andean Community (Comunidad Andina, CAN)? ANA MARIA SANCHEZ VARGAS: Although the PA and Mercosur differ in terms of the scope of free trade, commercial ties between them are substantial. Nearly 40% of Peru’s regional trade takes place with Mercosur. Both integration processes also work jointly in deepening freedom of movement for…

Overview

Taking the stage: An expanding minerals industry and ongoing economic diversification is spurring growth
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Bouncing back from political instability and hyperinflation in the 1970s and 1980s, Peru has sustained average GDP growth of 6% since 2004. A major metals and minerals exporter, Peru’s growth has been fuelled in large part by high commodity prices and stable demand from China. This has allowed the country to become an important player on the world stage in copper, gold and silver, which account for 77% all Peru’s total mining exports. Peru is also a rapidly growing producer of zinc and lead. Economy The…

Interview

Taking the initiative: OBG talks to Jorge Familiar, Vice-President for Latin America and the Caribbean, World Bank
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Interview:Jorge Familiar What needs to be done in mining-based countries such as Peru and Chile to decrease their dependence on commodity exports? JORGE FAMILIAR: Commodity exports are an important part of the economy of many Latin American countries and will continue to be so in the future. Natural resource-rich countries can diversify toward other activities as they increase their physical and human capital, liberalise their trade, reduce their transport and transaction costs, and accelerate…