An Introduction to the Peruvian Economy Renzo Del Giudice (洛子謙)
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An Introduction to the Peruvian Economy
Renzo Del Giudice (洛子謙)
Introduction
• I would like to introduce you one of the best performing economies in
Latin America: Peru.
• First, I will explain about the historical background and the modern
development of the Peruvian society.
• Afterwards, you will appreciate macroeconomic indicators, financial
statements and social economic challenges in Peru.
An Introduction to the Peruvian Economy - Renzo Del Giudice 2
Peru’s Map
An Introduction to the Peruvian Economy - Renzo Del Giudice 3
1. Historical Background
Ancient Peru: Cradle of many civilizations and Inca empire.
Under the Spanish empire rule, Peru was the politic and economical center of South America.
After the independence (1821), the Republic of Peru was involved in many wars, richness
periods and economical crisis.
An Introduction to the Peruvian Economy - Renzo Del Giudice 4
2. Modern Development of Peruvian Society
Nowadays, Peru have a multicultural population with a high human development index (0,741 – 2015).
In the last 30 years, Peru went from being a country merged in economic crisis to be the country with the most consistent rate of development in Latin America. (Focus Economics)
The country has strengthened its diplomatic, economic and cooperative relations with USA, Europe, and specially with Asia Pacific countries (specifically China).
An Introduction to the Peruvian Economy - Renzo Del Giudice 5
3. Macroeconomic Indicators (2015)
• Population : 31.9 million.
• GDP : USD 191 billion. (P: 8%, S: 38%, T: 54%)
• GDP Per Capita : USD 5,993
• Population Beyond Poverty Line : 17.8%
• Unemployment Rate : 6.5%
• Economic Growth : 3.3%
• External Debt (% of GDP) : 35.7
• Imports : USD 37.4 billion
• Exports : USD 34.2 billion
Source: Focus EconomicsAn Introduction to the Peruvian Economy - Renzo Del Giudice 6
3. Macroeconomic Indicators (2015)
Peruvian PBI Evolution
1998: Asian Financial Crisis and El Niño Event.2001: Private investment brought about by political instability.2009: International Financial Crisis.2014: Commodities Prices Fall.
An Introduction to the Peruvian Economy - Renzo Del Giudice 7
4. Financial Indicators (2015)
• Fiscal Balance (% of GDP) : -2.1
• Inflation (PPI annual variation in %) : 1.8
• Policy Interest Rate (%) : 3.75
• Stock Market (annual variation in %) : -33.4
• Exchange Rate (vs USD) : 3.41
• Current Account Balance (USD bn) : -8.4
• Current Account (% of GDP) : -4.4
• International Reserves : USD 61.5 million.
Source: Focus EconomicsAn Introduction to the Peruvian Economy - Renzo Del Giudice 8
4. Financial Indicators (2015)
Credit RatingStandard & Poor’s
A- (Domestic)
BBB+ (Foreigner)
A (T&C Assessment)
Outlook: Stable
Moody’s
A3
Outlook: Stable
Fitch
BBB+
Outlook: Positive
Source: Ministry of Economy (Peru)An Introduction to the Peruvian Economy - Renzo Del Giudice 9
4. Financial Indicators (2015)
Background
Founded in 1860, Lima Stock Exchange was in 2007, the most profitable stock exchange in the world.
Nowadays, it is integrated with Santiago, Mexico DF and Bogota Stock Exchanges.
Market Capitalization:
USD 409,363.53 million
Index:
IGVBL (General Index of Lima Stock Exchange)
ISVBL (Selective Index of Lima Stock Exchange)
Most Profitable Shares (2015)
Alicorp (26.32%), Hidrandina (21.73%), Backus & Johnson (13.31%), Sociedad Minera Corona (12.53%),
Minera Buenaventura (11.17%)
Lima Stock Exchange
Source: Bolsa de Valores de LimaAn Introduction to the Peruvian Economy - Renzo Del Giudice 10
5. Social Economical Challenges
Social Conflicts with Mining Activities
• Minery: aprox. 60% of Peruvian Exportations
• Currently conflicts: Conga, Tia Maria, Las Bambas
Narcotrafic
• 1st Cocaine Producer in the world
• Increased crime and money laudering
Economic Inequality
• Lima has high developed living standards, unlike inside the country
• It generates lower quality in education and basic services
An Introduction to the Peruvian Economy - Renzo Del Giudice 11
Thanks for your Attention!
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