Peru's Business and Investment Guide 2021 is a tool for foreign and national investors, providing key information on the country's current situation.
Peru is considered one of the world's leading emerging markets, with a solid recent history of economic stability based on an uninterrupted average annual growth over this millennium until December 2019 of 4.6% of its Gross Domestic Product (GDP). Additionally, a policy of being open to the international market through multiple commercial agreements complements legislation that is favorable to private domestic and foreign investment.
Peru is one of the most important countries in Latin America. Its diverse characteristics include a variety of climates, a vast territorial expanse, significant natural resources, people with great skills and high academic standards, and a solid economic and industrial background.
Challenges to achieve sustained growth
Uninterrupted economic growth over the past 20 years until 2019 has consistently contributed to the improvement of infrastructure, development of human capital, the adoption of new technologies and the standard of living of all Peruvians.
The recognition of Peru's solid economy is based on low inflation (at the close of 2020, it is 23 consecutive years of single digit inflation), international reserves equivalent to 38% of GDP, a controlled fiscal deficit (an average of 2.5% of GDP over the past five years, and an estimated 8.9% at the close of 2020), and public debt that is estimated to not exceed 36% of GDP at the close of 2020, well below the average of the rest of emerging countries in the world (63.1%) and in the region (81.5%). Additionally, 2020 closes with an estimated trade surplus of more than USD7.7 billion.
This situation permitted one of the region's major responses to the effects of COVID-19, with fiscal measures equivalent to 20% of GDP that will bolster a rapid recovery of economic growth estimated to be more than 10% of the GDP for 2021, according to forecasts by the Central Reserve Bank of Peru (BCRP) and the Ministry of Economy and Finance. These forecasts are way above the average for the region (3.6%), for emerging countries (6.0%) and advanced economies (3.9%). As a result, Peru will be one of the countries in the region, together with Chile and Colombia, that will see its GDP return to pre COVID-19 levels in 2022.