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Peru – US Trade Promotion Agreement: Fernando Albareda Commercial Counselor Consulate General of Peru in Miami Business Opportunities for US Companies

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Page 1: Peru – US Trade Promotion Agreement: Fernando Albareda Commercial Counselor Consulate General of Peru in Miami Business Opportunities for US Companies

Peru – US Trade Promotion Agreement:

Fernando AlbaredaCommercial Counselor

Consulate General of Peru in Miami

Business Opportunities for US Companies

Page 2: Peru – US Trade Promotion Agreement: Fernando Albareda Commercial Counselor Consulate General of Peru in Miami Business Opportunities for US Companies

Table of Contents

1. PERU: One of the Fastest Growing Economies.

2. PERU – US Bilateral Trade3. PERU Trade Promotion Agreement4. Business Opportunities for US

Companies

Page 3: Peru – US Trade Promotion Agreement: Fernando Albareda Commercial Counselor Consulate General of Peru in Miami Business Opportunities for US Companies

Peru: One of the Fastest Growing Economies

Page 4: Peru – US Trade Promotion Agreement: Fernando Albareda Commercial Counselor Consulate General of Peru in Miami Business Opportunities for US Companies

Peru: One of the Fastest Growing Economies

Sustained GDP growth, with an average GDP growth rate 2001-2009 of 5.4%. The maximum rate in 2008 with 9.8% and minimun in 2009 with 1%. Peru’s growth has been the highest in Latin America.

Diversified and growing exports (24% annual average growth from 2001 to 2008)

Sovereign risk below Latin American average (EMBI Global + 273 base points in 2008 compared the 426 base points regional average)

National poverty rate fell 12.4 percent points between 2004 and 2008, from 48.6% to 36.2%

Page 5: Peru – US Trade Promotion Agreement: Fernando Albareda Commercial Counselor Consulate General of Peru in Miami Business Opportunities for US Companies

Peru: One of the Fastest Growing Economies

Simultaneously with improved internal indicators, the strong fiscal position explained that in 2008, Peru was awarded investment grade by several international rating agencies.

High foreign currency reserves: $33,135.0 millions in 2009, over 20 months worth of imports

Growth forecast for 2010 is around 5.5%

Peru is strongly positioned to resume the path of growth once the global economy stabilizes

Page 6: Peru – US Trade Promotion Agreement: Fernando Albareda Commercial Counselor Consulate General of Peru in Miami Business Opportunities for US Companies

6

Peru is projected to grow by 5,5 per cent …DOMESTIC DEMAND AND GDP

(Percentage changes)

Page 7: Peru – US Trade Promotion Agreement: Fernando Albareda Commercial Counselor Consulate General of Peru in Miami Business Opportunities for US Companies

Trade Balance surplus would continue in the next years

7

TRADE BALANCE(Millions of US$)

Page 8: Peru – US Trade Promotion Agreement: Fernando Albareda Commercial Counselor Consulate General of Peru in Miami Business Opportunities for US Companies

8

Continued progress in gaining access to global markets

Page 9: Peru – US Trade Promotion Agreement: Fernando Albareda Commercial Counselor Consulate General of Peru in Miami Business Opportunities for US Companies

Multinational Companies Operating in Peru

Shougang Corp Sapet Marubeni Honda SK LS Nikko Sumitomo Matsushita P&O Dover China Fishery Group Chinalco Zijin Mining Nippon Mining Mitsui Mining

Teck Cominco Quebecor Barrick Scotiabank

Firth Ind. Newcrest BHP Chariot Amcor Downing Teal Orica Rio Tinto

Grupo Slim Grupo Mexico Grupo Bimbo Zeta Gas Minas Peñoles Banco Azteca Elektra Café Britt

Techint Pluspetrol Odebrecht Petrobras AmBev Gerdau Votorantim Vale Grupo ISA Falabella Ripley CENCOSUD ENAP LAN

• Hunt Oil• Nextel• Citibank• Phelps Dodge• Duke Energy• Freeport McMoRan• Procter & Gamble• Kimberly Clark• Coca Cola Comp.• Chevron Corp.• Cargill• Kraft• Sempra• PSEG• Newmont• Doe Run

• Telefónica• BBVA• Endesa• Repsol - YPF• HSBC• Flughafen Frankfurt• Suez Group • Xstrata• Acea /Impregilo• Messer• Faber Castell• Deutsche Bank• Grupo Santander• Grupo Fierro• Ashmore• SN Power• Elecnor / Isolux• Polysius• OHL• Orient Express• Cimpor

Anglo American Sonatrach Gold Fields Sab Miller

Page 10: Peru – US Trade Promotion Agreement: Fernando Albareda Commercial Counselor Consulate General of Peru in Miami Business Opportunities for US Companies

Peru-US Bilateral Trade

Page 11: Peru – US Trade Promotion Agreement: Fernando Albareda Commercial Counselor Consulate General of Peru in Miami Business Opportunities for US Companies

BALANCE OF TRADE PERU – U.S.In 1,000,000 Dollars (2007 / 2008) / (2008 / 2009)

2007 2008%

Change 2008 2009%

Change

PERU X’S TO US 5,207.1 5,839.9 12.20% 5,839.9 4,234.6 -27.50%

PERU M’S FROM US 3,764.3 5,687.0 51.10% 5,687.0 4,355.8 -23.40%

BILATERAL TRADE 8,971.4 11,526.9 28.50% 11,526.9 8,590.4 -25.47%

BALANCE OF TRADE

1,442.8 152.9 -89.40% 152.9 -121.2 -179.26%

Page 12: Peru – US Trade Promotion Agreement: Fernando Albareda Commercial Counselor Consulate General of Peru in Miami Business Opportunities for US Companies

Peru Exports to the U.S. Per Chapter / In 1,000 Dollars / 2007 / 2008 / 2009

HTS Number 2007 2008% Change 2007/2008 2009

% Change 2008/2009

71 PRECIOUS OR SEMI PRECIOUS STONES 903,259 1,029,429 14.00% 812,060 -21.10%

27 MINERAL FUELS, MINERAL OILS 810,119 1,182,176 45.90% 641,940 -45.70%

74 COPPER AND ARTICLES 1,067,134 929,734 -12.90% 583,696 -37.20%

61 APPAREL AND CLOTHING ACC. 764,209 749,216 -2.00% 566,743 -24.40%

80 TIN AND ARTICLES 262,168 366,047 39.60% 266,107 -27.30%

7 EDIBLE VEGETABLES AND ROOTS 228,228 230,580 1.00% 237,579 3.00%

9 COFFEE, TEA, MATE AND SPICES 179,254 230,774 28.70% 207,949 -9.90%

20 PREPARATIONS OF VEGETABLES, FRUITS, NUTS 107,971 161,954 50.00% 162,137 0.10%

3 FISH AND CRUSTACEANS, MOLLUSCUOS 74,417 84,443 13.50% 99,940 18.40%

26 ORES, SLAG AND ASH 182,676 195,146 6.80% 98,228 -49.70%

8 EDIBLE FRUIT AND NUTS 81,564 107,288 31.50% 96,253 -10.30%

79 ZINC AND ARTICLES THEREOF 4,033 43,901 988.60% 66,960 52.50%

Sub-Total 4,665,032 5,312,696 13.88% 3,839,592 -27.73%

All Others: 494,084 516,009 4.40% 447,627 -13.30%

Total 5,207,070 5,839,906 12.20% 4,234,615 -27.50%

Page 13: Peru – US Trade Promotion Agreement: Fernando Albareda Commercial Counselor Consulate General of Peru in Miami Business Opportunities for US Companies

19.18%

15.16%13.78%13.38%

6.28%

5.61%

4.91%

3.83%

2.36%2.32%

2.27%

1.58%

71 Precious or Semi PreciousStones

27 Mineral Fuels, Mineral Oils

74 Copper and Articles

61 Apparel and Clothing Acc.

80 Tin and articles

7 Edible Vegetables and roots

9 Coffee, Tea, Mate andSpices

20 Preparations ofVegetables, Fruits, Nuts

3 Fish and Crustaceans,Molluscuos

26 Ores, Slag and Ash

8 Edible Fruit and Nuts

79 Zinc and Articles Thereof

Peru Exports to the U.S. 2008/2009

71

320

9

7

80

6174

27

79826

Page 14: Peru – US Trade Promotion Agreement: Fernando Albareda Commercial Counselor Consulate General of Peru in Miami Business Opportunities for US Companies

Peru Imports from U.S. Per Chapter / In 1,000 Dollars / 2007 / 2008 / 2009

HTS Number 2007 2008% Change 2007/2008

2009% Change 2008/2009

84 MACHINERY AND MECHANICAL APPL 874,132 1,305,826 49.40% 1,077,466 -17.50%

27 MINERAL FUELS 503,801 1,197,981 137.80% 487,463 -59.30%

85 ELECTRICAL MACHINERY 263,694 445,939 69.10% 372,290 -16.50%

39 PLASTICS AND ARTICLES THEREOF 406,580 505,693 24.40% 344,434 -31.90%

87 VEHICLES 178,685 229,127 28.20% 218,442 -4.70%

10 CEREALS 232,112 171,700 -26.00% 180,409 5.10%

38 MISCELLANEOUS CHEMICAL 85,195 109,848 28.90% 138,517 26.10%

98 SPECIAL CLASSIFICATION PROVISIONS 112,700 172,456 53.00% 133,760 -22.40%

29 ORGANIC CHEMICALS 159,849 171,755 7.40% 127,600 -25.70%

90 OPTICAL, PHOTOGRAPHIC 104,118 134,139 28.80% 117,042 -12.70%

72 IRON AND STEEL 36,407 183,352 403.60% 79,517 -56.60%

31 FERTILIZERS 62,014 105,628 70.30% 75,846 -28.20%

Sub Total 3,019,287 4,733,444 56.77% 3,352.786 29.17%

All others 774,996 953,542 28% 1,002,987 5.20%

Total 3,764,282 5,686,984 51.10% 4,355,772 -23.40%

Page 15: Peru – US Trade Promotion Agreement: Fernando Albareda Commercial Counselor Consulate General of Peru in Miami Business Opportunities for US Companies

24.74%

11.19%8.55%

7.91%

5.02%

4.14%

3.18%

3.07%

2.93% 2.69%

1.83%

1.74%

84 MACHINERY ANDMECHANICAL APPL

27 MINERAL FUELS

85 ELECTRICAL MACHINERY

39 PLASTICS AND ARTICLESTHEREOF

87 VEHICLES

10 CEREALS

38 MISCELLANEOUSCHEMICAL

98 SPECIAL CLASSIFICATIONPROVISIONS

29 ORGANIC CHEMICALS

90 OPTICAL,PHOTOGRAPHIC

72 IRON AND STEEL

31 FERTILIZERS

Peru Imports from U.S. 2008/2009

84

2785

39

87

1038

98 29 90 72 31

Page 16: Peru – US Trade Promotion Agreement: Fernando Albareda Commercial Counselor Consulate General of Peru in Miami Business Opportunities for US Companies

Peru Trade Promotion Agreement

Page 17: Peru – US Trade Promotion Agreement: Fernando Albareda Commercial Counselor Consulate General of Peru in Miami Business Opportunities for US Companies

Peru Trade Promotion Agreement Balance of the

Negotiation for Peru Maintained the access granted to Peruvian

products under the ATPDEA. Duty free treatment to products not included

before in ATPDEA: cotton fiber, yarns and fabrics, other textile products (not apparel), among others. Almost 98% of the Peruvian exports are granted duty free treatment.

Increased cuotas for some food products: dairy products (evaporated milk, cheese, dulce de leche), sugar.

Page 18: Peru – US Trade Promotion Agreement: Fernando Albareda Commercial Counselor Consulate General of Peru in Miami Business Opportunities for US Companies

Peru Trade Promotion Agreement Balance of the

Negotiation for the US Eighty percent of US exports of consumer and

industrial products to Peru become duty free immediately, with remaining tariffs phased out over 10 years.

More than 2/3 of current US farm exports will become duty free immediately. Other US farm products will be phased out within 15 years, with all tariffs eliminated in 17 years.

Access of remanufactured equipment into the Peruvian market.

Automobiles of more than 3.0 Lt manufactured in the US have duty free acces.

Page 19: Peru – US Trade Promotion Agreement: Fernando Albareda Commercial Counselor Consulate General of Peru in Miami Business Opportunities for US Companies

PTPA Main Considerations

The Agreement establishes a secure, predictable legal framework for US investors operating in Peru.

US investors will enjoy the right to establish, acquire and operate investments in Peru same as local investors.

The Agreement provides for improved standards for the protection and enforcement of a broad range of intellectual property rights, consistent with US and international standars.

Page 20: Peru – US Trade Promotion Agreement: Fernando Albareda Commercial Counselor Consulate General of Peru in Miami Business Opportunities for US Companies

PTPA Main Considerations

Stronger protection for US patents, trademarks and test data, including an electronic system for the registration and maintenance of trademarks.

US suppliers are granted non-discriminatory rights to bid on contract from a broad range of Peruvian government ministries, agencies, public enterprises, and regional governements.

Page 21: Peru – US Trade Promotion Agreement: Fernando Albareda Commercial Counselor Consulate General of Peru in Miami Business Opportunities for US Companies

PTPA Main Considerations

The Agreement’s dispute settlement mechanisms provide for open public hearings, public access to documents, and the opportunity of third parties to submit views.

Transparency in customs operations will aid express delivery shipments and will require more open and public processes for customs ruling and administration.

The Agreement includes obligations in labor and environmental issues according to international laws.

Page 22: Peru – US Trade Promotion Agreement: Fernando Albareda Commercial Counselor Consulate General of Peru in Miami Business Opportunities for US Companies

Business Opportunities for US Companies

Page 23: Peru – US Trade Promotion Agreement: Fernando Albareda Commercial Counselor Consulate General of Peru in Miami Business Opportunities for US Companies

Best Prospects for Increased Market Growth for US Companies

Agriculture:

- Almost 80% of current agricultural exports receive duty free treatment, among them: cotton, wheat, soybeans, apples, pears, peaches, cherries and almonds.

Page 24: Peru – US Trade Promotion Agreement: Fernando Albareda Commercial Counselor Consulate General of Peru in Miami Business Opportunities for US Companies

Best Prospects for Increased Market Growth for US Companies Information Technology Products:

- Almost all information technology products have duty free treatment. Best prospects in this sector include computers and computer parts, radio and television broadcasting apparatus and software.

Industrial Machinery:

- Capital goods exports have duty free treatment.- Agricultural and construction equipment, food

processing, packing equipment, heating and cooling equipment will benefit from the Agreement.

Page 25: Peru – US Trade Promotion Agreement: Fernando Albareda Commercial Counselor Consulate General of Peru in Miami Business Opportunities for US Companies

Best Prospects for Increased Market Growth for US Companies

- Peru increasing investment projects in infrastructure as roads, ports and airports will continue to fuel demand for specialized machinery.

- Natural resources in mining in the Andean region and hydrocarbon reserves along the northern Coast and in the jungle have ignited interest in prospecting and exploration.

Page 26: Peru – US Trade Promotion Agreement: Fernando Albareda Commercial Counselor Consulate General of Peru in Miami Business Opportunities for US Companies

Best Prospects for Increased Market Growth for US Companies Chemicals:

- Best prospects in this sector include polyethylene, lubricant oil additives and acrylic polymers.

- 96% of fertilizer and agrochemical exports have duty free treatment.

Remanufactured Equipment:

- US remanufacturers of products such as: engines, radiators and alternators for construction equipment and transportation machinery, will be able to export their products without non tariff barriers.

Page 27: Peru – US Trade Promotion Agreement: Fernando Albareda Commercial Counselor Consulate General of Peru in Miami Business Opportunities for US Companies

Best Prospects for Increased Market Growth for US Companies

Medical Equipment:- 90% of medical equipment exports receive

duty free access, with remaining duties phased out over five years.

- Best prospects: instrument parts, electro diagnostic apparatus and ultrasound.

Page 28: Peru – US Trade Promotion Agreement: Fernando Albareda Commercial Counselor Consulate General of Peru in Miami Business Opportunities for US Companies

Best Prospects for Increased Market Growth for US Companies Electrical Power Generation and

Distribution Equipment:

- The government of Peru is encouraging electric power producers to convert from oil and diesel fuels to natural gas. This request will lead to greater need for power generation equipment in Peru.

Page 29: Peru – US Trade Promotion Agreement: Fernando Albareda Commercial Counselor Consulate General of Peru in Miami Business Opportunities for US Companies

Main Websites

www.tlcperu-eeuu.gob.pe www.ustr.gov www.export.gov/FTA/peru/index.asp

Page 30: Peru – US Trade Promotion Agreement: Fernando Albareda Commercial Counselor Consulate General of Peru in Miami Business Opportunities for US Companies

Thank you

Fernando Albareda

Tel 786-347-2426

E-mail: [email protected]