September 23, 2021. Lima, Peru.- After a tour of Mexico and the United States, Pedro Francke head of the Ministry of Economy and Finance (MEF) explains the results of his meetings with potential investors and companies that already operate in the country, as well as the actions that his portfolio took to attract private capital companies and generate more jobs.
What are the results of the meetings with investors?
-We had a very good meeting with businessmen from Mexico from various sectors, such as mining, energy, beverages, among others; then a very good meeting in Washington, with the members of the American Chamber of Commerce, which groups together practically all the large transnational corporations in the United States and some countries.
The President of the Republic, Pedro Castillo, was also there, who gave a very clear message regarding respect for property and working together, the State and private investment. I think it was very well received by the businessmen.
Later we had meetings with representatives of international organizations, such as the International Monetary Fund (IMF), the World Bank (WB) and the Inter-American Development Bank (IDB). The first will help us with technical assistance in the tax part, while the other organizations are totally open and interested in financing projects and the development of Peru.
For my part, I had several meetings, especially with financial investors, those who buy Peruvian bonds, who invest in the Lima Stock Exchange (BVL), with large investors who move a few trillion dollars in the world.
They were very positive meetings, all of them see Peru as a country with great potential, with a very responsible tax policy. In addition, we have a very low level of debt; therefore, they are very willing to finance Peru.
We dispel the doubts they had. Always a face-to-face dialogue is essential to be able to answer questions; from afar there are things that may not be understood well and I think that in that conversation we made significant progress in being able to generate confidence and, in this way, attract investment and financing to reactivate the economy and create jobs, which is our great objective.
Did you have the opportunity to meet with representatives of the firm BlackRock and the rating agencies Fitch, Moody’s and Standard & Poor’s?
-Yes, we met with several large investors, such as the firm Pimco and others that manage significant funds on an international scale.
We also spoke with Standard & Poor's, one of the three largest credit rating agencies.
The Minister of Energy and Mines pointed out that there is a viable portfolio of mining projects for US $ 50,000 million; How can Peru accelerate the arrival of investment and have a greater impact on the economy?
-In the business meetings were present several executives of large mining companies that invested or will do so in Peru.
Quellaveco is already finishing executing its capitals next year. In addition, we spoke with Angloamerican managers to find out how to help them.
Yanacocha Newmont has this new Yanacocha Sulfuros project, which in the next 12 months will invest the first US $ 500 million of a total of US $ 2.100 million, which we were informed is the largest investment made by the company on an international scale in 15 years.
Mining investment is important, but we must also pay close attention to other sectors, such as forestry, aquaculture, agro-export and industrial sector.
An investor concern is the rules of the game, the legal framework and the tax issue . Can you tell us what are MEF initiatives in taxation?
-With regard to tax reform, it seems to me that there is a national consensus on the need to combat tax evasion. About half of the income tax in Peru is not paid and also in the mining sector there are high profits due to a very high price of copper.
We can have a better way of sharing that between the state and private companies, and for small units there is also a broad consensus that we need a more simplified system.
The services of the digital platforms have to pay their taxes; the National Superintendency of Tax Administration (Sunat) must use new information technologies. They are some of the big issues in tax reform.
Next week we must present the request for the delegation of legislative powers to Congress and begin to work in an effort of much consultation and dialogue with the different banks to have a tax system that is really much more functional, fair and equitable for all Peruvians.
We want this to come out soon to resolve this issue and apply it from next year; it seems to me essential.
On the issue of stability, first of all, we have a macroeconomic framework that generates an extremely clear tax sustainability path and there is considerable international recognition that Peru's tax strength is extremely solid and that our proposal is well anchored in maintaining that position.
But we maintain other mechanisms of stability agreements and respect for investments that I think are quite attractive for private investment, there we have an economic policy in general that is quite friendly and favorable to private investment.
MEF will promote capital
The head of the Ministry of Economy and Finance (MEF) pointed out that his portfolio will promote roadshows or promotional tours to attract foreign private investment to our country.
“Without a doubt, the issue of promoting Peru as an investment attraction, explaining economic policy and attracting investors is an important objective for MEF and, indeed, we spoke with several institutions and banks to see the possibility of organizing this type of investment presentations on other continents, such as Europe and Asia ”, said Minister Francke.
On the other hand, he pointed out that his management will promote public-private partnerships (PPP) for large infrastructure projects. In this regard, he said that the advancement of Line 2 of the Lima Metro, the expansion of the Jorge Chávez International Airport, the Autopista del Sol in the north of the country, as well as ports and the project of the new Central highway will be supported.
"What we see on this tour is a lot of interest from international investors in continuing to participate in infrastructure in Peru and in developing works that have an impact and relationship with environmental improvement and climate change," he said.
Source: El Peruano