8 minutos de lectura 21 feb. 2020
Mining & Metals Investment Guide 2020/2021

Peru's Mining & Metals Investment Guide 2020/2021

Por Marcial García

Transfer Pricing and Tax Services Partner, Mining & Metals Leader, EY Perú

Atento a los detalles y enfocado en la excelencia. Fanático del running, participa activamente en carreras.

8 minutos de lectura 21 feb. 2020

Economic overview

Peru, a country of 32.8 million people, is one of Latin America’s fastest-growing economies. It has rich deposits of copper, gold, silver, lead, zinc, natural gas and petroleum. It is also a very diverse country due to climatic, natural and cultural variations of its regions. Peru’s economy reflects its varied geography, an arid coastal region, the Andes further inland, and tropical lands bordering Colombia and Brazil. Abundant mineral resources are found mainly in the mountainous areas, and Peru’s coastal waters provide excellent fishing grounds.

Mining is the dominant sector of the Peruvian economy. Substantial additional investment has flowed to the sector over the past 20 years. As a result, there has been an increase in exploration and development activities. Peru is among the major producers of mineral commodities in the world. They account for nearly 60% of the country´s total exports. Copper and gold are the most important mineral exports by value.

In recent years, Peru has achieved significant advances in social and development indicators as well as in macroeconomic performance, with very dynamic GDP growth rates, reduction of external debt, a stable exchange rate and low inflation. Peru’s rapid expansion has helped to reduce the national poverty rate from 48.5% in 2004, to 20.5% of its total population in 2018. Extreme poverty declined from 17.4% to 2.8% over the same period.

The country has had continuous economic and political stability since the early 1990s. Peru has been one of the region’s fastest-growing economies, over the past two decades, in a context of low inflation. Prudent macroeconomic policies, investor-friendly market policies and the government’s aggressive trade liberalization strategies combined to create a scenario of high growth and low inflation. 

Economic overview
External debt US$ 22.9 billion (2018)
Investment 22.4% GDP (2018)
Unemployment rate 6.4% (2018)
Population below poverty line 20.5% (2018)
Export partners Brazil, Canada, China, India, Japan, Korea, Netherlands, Switzerland, US
Export commodities Gold, copper, zinc, crude oil and by-products, coffee, potatoes, asparagus, textiles, fish meal
Import partners Argentina, Brazil, Chile, China, Colombia, Ecuador, Mexico, US
Import commodities Petroleum and by-products, plastics, machinery, vehicles, iron and steel, wheat, paper
Sources: BCRP / Ministry of Economics and Finance / INEI / ECLAC

After an estimated 2.3% growth in 2019, Peru’s economy will recover, and it is expected to grow 3.8% in 2020 and 2021. 

Peru’s Investment-Grade Rating

Peru has maintained its investment-grade credit rating since Moody’s Investors Services raised it to that level in December 2009 matching moves made by Standard & Poor’s and Fitch Ratings the previous year. The country’s stable, credible and consistent macroeconomic policies in various administrations are the key supporting factors for the investment-grade rating.

It is well known that countries with investment grade ratings gain a higher level of confidence that generates more foreign and domestic investment. The risk premium demanded by multinationals and foreign investors is slashed after the upgrade. At the same time, the investment horizon is elongated.

The upgrade to investment grade has brought Peru a lot of positive attention worldwide. More importantly, it has had a positive impact on the local economy. For this reason, nowadays, many multinational corporations eye the country more seriously, as higher private investment is flowing into the country. This should contribute to alleviate a still complex social situation in Peru, by achieving improvements in employment and decreases in poverty. 

Credit rating (long term debt in Foreign Currency)
Country S&P Fitch Moody's
Chile A+ A A1
Peru  BBB+ BBB+ A3
Mexico BBB+  BBB A3
Colombia  BBB- BBB Baa2
Uruguay  BBB BBB- Baa2
Paraguay  BB BB+ Ba1
Brazil  BB- BB- Ba2
Bolivia  BB- B+ Ba3
Ecuador  B- B- B3
Argentina  CCC- CC Caa2
Venezuela  SD WD C
As of January 2020
Sources: Standard & Poor’s / Fitch Ratings / Moody’s

Importance of Peru’s mining sector

The mining sector is and has always been very important to the national economy of Peru. Its well-known mining tradition dates to the pre-Inca times, and goes on through the Inca, colonial and republican periods. In each of those stages, mining has been one of the major activities in the country’s development. Traditionally it has contributed about half of the country’s export revenues.

Peru is one of the most extensively mineralized countries of the world. It currently plays host to some of the world’s major mining companies, including, Glencore, Freeport-McMoRan, Rio Tinto, Anglo American, MMG, Teck, Chinalco and Barrick. Since the liberalization of the industry in the 1990s local and foreign investment has been deployed to develop major modern mines.

Peru has a well-recognized mineral wealth. It is considered one of the top ten richest mineral countries in the world. It is one of the world’s biggest producers of base and precious metals. Currently, it is the world´s second largest producer of copper and it is also a major producer of gold, silver, zinc, among other minerals. Peru has 10.0% of the world’s copper reserves, 4.8% of its gold, 19.6% of its silver, 9.1% of zinc, 7.2% of lead and 2.3% of tin reserves, according to the most recent data published by the US Geological Survey. Copper, gold, zinc and lead represent 53.8% of the national total exports and 90.4% of the value of exported mining products. 

Peru’s mineral production
Production Units 2014 2015 2016 2017 2018 2019
COPPER FMT 1,377,642 1,700,814 2,353,859 2,445,585 2,437,035 2,455,440
GOLD Fine gr. 140,097,028 146,822,907 153,005,897 151,103,938 140,210,984 128,413,463
ZINC FMT 1,315,475 1,421,513 1,337,081 1,473,073 1,474,383 1,404,382
SILVER Fine Kg 3,768,147 4,101,568 4,375,337 4,303,541 4,160,162 3,860,306
LEAD FMT 277,294 315,784 314,422 306,794 289,123 308,116
IRON FMT 7,192,592 7,320,807 7,663,124 8,806,452 9,533,871 10,120,007
TIN FMT 23,105 19,511 18,789 17,790 18,601 19,853
MOLYBDENUM FMT 17,018 20,153 25,757 28,141 28,034 30,441
Source: Ministry of Energy and Mines
Total mining investments in Peru (US$) 
  2014 2015 2016 2017 2018 2019
Beneficiation plant 889,682,461 446,220,610 238,198,426 286,720,393 1,411,676,115 1,512,994,358
Mining equipment 557,607,616 654,233,735 386,908,382 491,197,398 656,606,475 1,035,404,125
Exploration 625,458,907 527,197,097 377,053,519 484,395,158 412,524,042 356,571,548
Preparation 420,086,095 374,972,373 349,690,539 388,481,559 761,288,310 1,151,532,751
Infrastructure 1,463,521,224 1,227,816,025 1,079,320,196 1,556,537,971 1,084,149,410 1,316,174,401
Others 4,122,853,398 3,594,184,486 902,392,511 720,684,303 621,190,528 784,454,904
Total 8,079,209,701 6,824,624,326 3,333,563,573 3,928,016,782 4,947,434,879 6,157,132,087
Source: Ministry of Energy and Mines

According to estimates, today the mining sector accounts for nearly 10% of the GDP, while mineral export revenues reached US$28.9 billion in 2018, representing 58.9% of the country’s total exports. Copper was the leading export metal, in terms of value, followed by gold, lead, zinc, iron, silver, tin and molybdenum. The mining sector is also important for the generation of employment for thousands of Peruvians and represents one of the main sources of fiscal revenues.  

Mining investment has grown


between 2018 and 2019 in Peru

It is estimated that Peru has some 200 operating mines and a pile of major projects currently waiting to be developed worth US$57.8 billion. The United Kingdom is the largest foreign investor in Peru in mining projects, followed by China, Canada and Mexico. Of the new mining investments expected to be developed, US$40.9 billion is planning to be allocated to copper projects, which represent the 71% of the total. 

Leader in the industry

Peru is a global leader in the mining industry, which makes it a natural choice for international investors. It is one of the world’s biggest producers of base and precious metals. Currently, it is the second largest producer of copper in the world and stands amongst the top four producers for silver, lead, zinc, tin and molybdenum.

Peru enjoys political and macroeconomic stability. It has a steadily growing economy, which is largely driven by mineral production. The high rates of production have attracted US$60 billion of inbound investment into
Peru´s mining sector in the last 10 years. But Peru has much more to offer. There are still an estimated US$57.8 billion of mining projects waiting to be developed in the country over the next few years.

International investors are a crucial part of the growth and success of Peru´s exploration and mining industry. Peru welcomes foreign investment with an open and stable mining regulatory environment. A foreign investment law guarantees the security of foreign and domestic investments. Furthermore, Peru is consistently undertaking measures to improve its business climate to attract more investment.

We invite you to contact us with your questions and we wish you all the best with your mining investment opportunities in Peru.

Por Marcial García

Transfer Pricing and Tax Services Partner, Mining & Metals Leader, EY Perú

Atento a los detalles y enfocado en la excelencia. Fanático del running, participa activamente en carreras.


Key information about Peru’s mining industry to assist investors in their decision making progress regarding the exploration and development of new extractive projects.

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Por Marcial García

Transfer Pricing and Tax Services Partner, Mining & Metals Leader, EY Perú

Atento a los detalles y enfocado en la excelencia. Fanático del running, participa activamente en carreras.