NEWS
PERU APPROVES EXPANSION OF LAS BAMBAS COPPER MINE PERU APPROVES EXPANSION OF LAS BAMBAS COPPER MINE HOSPITAL PROJECTS OF THE SOCIAL HEALTH INSURANCE OF PERU (ESSALUD) CAPTURE THE INTEREST OF INVESTORS STREAMLINE PROCESSES TO APPROVE ENVIRONMENTAL IMPACT STUDIES IN INVESTMENT PROJECTS AGREEMENT BETWEEN PERU AND JAPAN TO AVOID DOUBLE TAXATION ENTERED INTO FORCE: WHAT DOES THIS IMPLY? SINGAPORE BECOMES THE FIRST PARTNER OF THE PACIFIC ALLIANCE CASTILLO SAYS THAT THE PERUVIAN GOVERNMENT IS COMMITTED TO HONORING OBLIGATIONS TO JOIN THE OECD SUSTAINABILITY OF PUBLIC FINANCES REQUIRES MORE THAN EVER PRIVATE INVESTMENT PUBLIC INVESTMENT WILL CONTRIBUTE TO THE ADVANCEMENT OF THE ECONOMY THIS YEAR CASTILLO REITERATES HIS INVITATION TO BUSINESSMEN TO INVEST IN PERU IN DAVOS 2022 JULIO VELARDE IS ELECTED AS CENTRAL BANKER OF THE AMERICAS 2022 BY FINANCIAL TIMES PPP PROJECT PORTFOLIO WAS PRESENTED TO CANADIAN INVESTORS THE PROMOTION OF PRIVATE INVESTMENT IN THE COUNTRY IS URGENT PROINVERSION PROMOTES PPP PROJECTS FOR US$ 6,300 MILLION TO INVESTORS FROM SINGAPORE, KOREA AND AUST INVESTMENT IN INDUSTRIAL SECTOR WILL GROW 26.9% THIS YEAR IN PERU THE PORT OF CHANCAY WILL HAVE A GREAT REGIONAL IMPACT AND WILL BE A HUB OF THE SOUTH PACIFIC MOODY'S: EXPORT SECTOR WILL BE THE ENGINE OF REACTIVATION OF THE PERUVIAN ECONOMY PERU RECORDED SURPLUS OF US$ 3,986 MILLION MEF RAISES PERU'S GROWTH PROJECTION TO 13% JOINING THE OECD IS A POLITICAL WILL OF THE STATE MEF AND ECLAC COORDINATE ON LITHIUM INVESTMENTS NET INTERNATIONAL RESERVES REACH US$ 75,358 MILLION AS OF OCTOBER 27 GOVERNMENT PLACED BONDS AMOUNTING US$ 4,000 MILLION IN THE INTERNATIONAL MARKET BCR: PUBLIC INVESTMENT WILL GROW 20% THIS YEAR AND 4.5% IN 2022 PERU ANNOUNCES PUBLIC TENDER OF TWO ELECTRICAL PROJECTS IN THE NORTH OF THE COUNTRY THROUGH PPP CASTILLO RATIFIES PERU'S INTEREST IN JOINING THE OECD CONFIRMED: JULIO VELARDE WILL REMAIN IN FRONT OF THE CENTRAL RESERVE BANK (BCR) FOR FIVE MORE YEARS PERSPECTIVES ON PERU'S GDP ARE FAVORABLE GLOBAL INVESTORS INTERESTED IN INFRASTRUCTURE WORKS IN PERU BCR: PRIVATE INVESTMENT WILL REACH US $ 41,700 MILLION THIS YEAR PROINVERSION PROMOTES TO INVESTORS ESSALUD HOSPITAL PROJECTS THE GOVERNMENT WILL ACCELERATE 52 INVESTMENT PROJECTS FOR S/ 114,000 MILLION The state will promote large Infrastructure Projects Peru in the Pacific Alliance San Juan de Marcona Port Project will be awarded next year Peru would lead regional growth There are 13 interested companies in participating in the tender for the Ancon Industrial Park Peru attracts great investments Gore Ancash promotes work for taxes projects for more than S/. 600 million Minister Francke met with the President of BCRP to coordinate economic and monetary policies President Pedro Castillo swears in his first Cabinet of Ministers Peru is on the right track in Fiscal Matters LT Puerto Maldonado-Iberia and Chira Valley Substation will boost Madre de Dios and Piura Arequipa: MEF approves addendum 13 to Majes Siguas II Project Agreement ratification gets the Go-ahead Mining exports already exceed Pre-pandemic levels MEF announces the unlock of the Majes Siguas Project Peru´s economic recovery is the highest in the region Foreign investment in Latin America will reach prepandemic levels in 2023 CCL: Peru has 921 investment megaprojects We seek to sign our first contract in Ports IMF: Peru Libre and Fuerza Popular in favor of maintaining a Macroeconomic soundness policy Agri Exporters seek to position Peruvian Organic Coffee in South Korea The rate of awarding of projects under the form of works for taxes returned the level prior to the p FITCH considers that Peruvian Companies maintain proper liquidity positions Mining investment totaled US$ 1,298 millon More than 1,561 new rural towns will have 4G mobile telephone and internet services LA LIBERTAD: THE MODERNIZATION OF THE PORT OF SALAVERRY IS 80% COMPLETE TOQUEPALA IS TAKING THE FIRST STEP TO ENTER 5G FOREIGN-OWNED COMPANY REINVESTMENT AMOUNTED TO US$ 2,310 MILLION BCR: RECOVERY OF PRIVATE INVESTMENT GDP TO GROW 34.4% IN THE SECOND QUARTER MOODY'S AGENCY ASSURES PERU'S A3 RATING US$ 340 MILLION IN LOANS FOR ROAD INFRASTRUCTURE PROINVERSIÓN CALLS FOR INTERNATIONAL BIDDING FOR PUBLIC TELECOMMUNICATIONS SERVICES ADDENDUM TO THE MUELLE NORTE CONCESSION WOULD ALLOW INVESTMENT OF US$ 1,050 MILLION FROM APMT. AMERICAN LITHIUM WILL PRIORITIZE LITHIUM PROJECT OVER URANIUM IN PUNO MEF KEPT 10% PROJECTED GROWTH FOR PERUVIAN ECONOMY FOR THIS YEAR RECORD IN THE EXECUTION OF PUBLIC INVESTMENT EUROPEAN UNION (EU) WILL SUPPORT TRANSPORTATION IMPROVEMENT COPPER NEARS 10-YEAR HIGH NATURAL RESOURCES MUST BE ENHANCED MONETARY FUND PROPOSES TO STRENGTHEN COUNTRIES' FISCAL RESPONSES TO THE CRISIS PROINVERSIÓN WILL RECEIVE BIDS FROM THE PRIVATE SECTOR FOR FOUR SANITATION PROJECTS SOUTHERN MINING CLUSTER WOULD ATTRACT US$ 14 BILLION IN INVESTMENTS BRITISH EMBASSY PRESENTS THREE CLIMATE ACTION PROJECTS TO BE IMPLEMENTED IN PERU PUBLIC INVESTMENT MARKS A RECORD RESULT IN THE FIRST QUARTER THE NEW CENTRAL HIGHWAY WILL BE CONNECTED WITH THE LONGITUDINAL DE LA SIERRA HIGHWAY PERU WILL HAVE THE LARGEST GDP EXPANSION IN SOUTH AMERICA THIS YEAR PERU RANKS SIXTH IN SOUTH AMERICA AS THE "MOST PREPARED" FOR STATE-OF-THE-ART TECHNOLOGIES A GUIDE TO DRAW INVESTMENT IN ENERGY PROJECTS IS PRESENTED LITHIUM ALSO FOUND IN CUSCO ANCON INDUSTRIAL PARK WILL HAVE 1,338 HECTARES FOR INDUSTRIAL, COMMERCIAL AND LOGISTICAL DEVELOPMENT PROJECTS FOR MORE THAN US$ 6 BILLION DRAW THE ATTENTION OF SPANISH INVESTORS THE GOVERNMENT PLACED BONDS AMOUNTING TO US$ 4,000 MILLION IN THE INTERNATIONAL MARKET PUBLIC INVESTMENT REACHED AN EXECUTION RECORD IN FEBRUARY CLARO AND ENTEL WILL DEPLOY 5G TECHNOLOGY FOR FIXED WIRELESS INTERNET COLOMBIA BETS ON INFRASTRUCTURE AND ENERGY PROJECTS AMOUNTING TO MORE THAN US$6 BILLION IN PERU CHINA WILL FURTHER ITS INVESTMENT IN PERU IMF INCREASES THE FORECASTED GDP GROWTH TO 9% IN 2021 MINING INVESTMENTS EXCEEDED EXPECTATIONS PORT MODERNIZATION INCLUDES NINE PROJECTS PROINVERSIÓN PROMOTES INFRASTRUCTURE PROJECTS TO EUROPEAN AND NORTH AMERICAN INVESTORS MEF MAINTAINS A 10% GROWTH RATE FOR 2021 PROINVERSIÓN HAS JOINED THE WORLD ASSOCIATION OF PPP UNITS AND PROFESSIONALS ELECTRICITY SECTOR PLANS AMOUNTING TO US$ 6,025 MILLION PROINVERSIÓN EXPECTS TO AWARD PROJECTS AMOUNTING TO US$ 2.5 BILLION THIS YEAR PROINVERSIÓN CALLS AN INTERNATIONAL BIDDING FOR THE ANCÓN INDUSTRIAL PARK PROJECT PERU WILL LEAD INVESTMENT IN THE NEXT THREE YEARS PROINVERSIÓN CALLS AN INTERNATIONAL COMPETITIVE BIDDING FOR THE ANCÓN INDUSTRIAL PARK PROJECT THE MTC WILL PROMOTE INVESTMENTS AMOUNTING S/ 1580 MILLION IN DIGITAL CONNECTIVITY PRIVATE INVESTMENT WILL GROW 17.5% THANKS TO MORE THAN 30 PROJECTS WB: PERUVIAN ECONOMY WILL GROW 7.6% IN 2021 PERU IS ONE OF THE COUNTRIES WITH THE GREATEST MACROECONOMIC STRENGTH

WB IMPROVES PERUVIAN GROWTH FORECAST FOR 2021

This Monday on March 29, the World Bank (WB) increased its growth forecast for the Peruvian economy for 2021 from 8.1% to 7.6%, according to the most recent semi-annual report for Latin America and the Caribbean, “Resume Growth.”

The World Bank’s forecast for the Peruvian Gross Domestic Product (GDP) shows the second highest growth in the region this year, only behind Guyana (20.9%) and ahead of Argentina with 6.4% and Chile with 5.5%.

Latin America and the Caribbean suffered more damage to the health and economy caused by the COVID-19 pandemic than any other region, but as the region economy begins to recover, new opportunities for significant transformation in key sectors arise, according to the new World Bank report.

Due to the pandemic, the GDP in Latin American and Caribbean region (except in Venezuela) fell 6.7% in 2020. A recovery of 4.4% is expected by 2021, compared to the Bank’s forecast at the end of 2020 from a decrease of 7.9% by 2020 and a GDP growth of 4% by 2021.

The enormous shock caused by the pandemic could lay the basis for increased productivity through economic restructuring and digitization. Other opportunities also arise from innovations in the electricity sector, according to the World Bank’s semiannual report for the LAC region, “Resume Growth.”

“The damage is severe, and we have witnessed a lot of suffering, particularly among the most vulnerable ones,” said Carlos Felipe Jaramillo, World Bank Vice President for the Latin American and Caribbean region. “However, we must always look ahead and make the most of this opportunity to carry out the necessary transformations to ensure a better future.”

The sharp contraction caused by the pandemic last year had enormous economic and social costs. In general, the unemployment rate increased and poverty skyrocketed, although in some countries the massive use of social transfers softened the social impact of the crisis.

The COVID-19 crisis will have a long-term impact on the economies of the region. Lower levels of education and employment are likely to reduce future revenue, while high levels of public and private debt can cause tension in the financial sector and slow down the recovery.

Despite these challenges, there are positive areas. International trade in goods remained relatively good, despite the sharp fall in trade in services, particularly tourism. Most commodity prices are higher than the prices before the COVID-19 crisis, partly thanks to China’s early recovery.

This is a good thing for exporters of agricultural and mining products. Remittances to the region increased compared to the pre-pandemic period, a very important issue for several countries in the Caribbean and Central America region.

Likewise, capital markets remained open for most of the countries in the region. In fact, international indebtedness increased, contributing to the mitigation of the economic and social impact of the COVID-19 crisis. Most countries in the region incurred in significant budget deficits since the beginning of the pandemic.

The additional expenditure was used to strengthen health systems, provide transfers to households, and help businesses. At the same time, the implementation of proactive measures helped debtors and reduced the risk of financial crises.

“As economies recover this year, some sectors and companies will win and others will lose,” said Martín Rama, World Bank Chief Economist for the Latin America and Caribbean region. “This pandemic gave rise to a creative destruction process that may result in faster growth but can also widen inequality within and between countries in the region.”

For example, hotel and personal services may suffer long-term damage, although information technology, finance and logistics will expand. In the medium term, the profits may be greater than the losses. The greatest transformation may result from accelerated digitization, which could lead to greater dynamism in financial intermediation, international trade and labor markets.

Technology is also an opportunity to transform the energy sector. Latin America and the Caribbean region have the cleanest power generation matrix of all developing regions, mainly due to the abundance of hydroelectric energy. The region should have the cheapest electricity in the developing world, but instead it has the most expensive one, essentially due to inefficiencies.

Businesses and households in the region pay much more for the electricity they consume than it would cost to generate it. These inefficiencies are reflected in frequent blackouts, technical and business losses, overstaffed public companies, and abuses of market power by private generators.

With an appropriate institutional framework, technology may increase competence in the sector, thus reducing the price of electricity and increasing the share of renewable energy. For example, distributed generation may make companies and households depend on their own energy sources, such as solar panels, and buy or sell electricity to the grid depending on the time of day.

In addition, an increase in cross-border trade in electricity may capitalize differences in installed capacity, generation costs, and seasonal factors of demand to generate mutual benefits. However, this efficiency improvement will only take place if electricity is bought and sold at an appropriate price.

While there are signs that the region’s economies are recovering and hopes that this disruption will have some positive outcome, the outlook for this year remains uncertain. The deployment of the vaccines has slowly progressed in the region, and herd immunity could only be achieved by the end of 2021.

Likewise, new waves of infections could occur as new variants of the virus emerge. As we actively prepare to recover better, the priority is still the protection of human life and livelihoods.

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