US and European companies will invest their capital in the country, says Minister Álex Contreras.
Confidence in investing in Peru is at its highest level in recent years. It improved from fifth to first place as the most attractive country in the region for foreign capital in 2024. This assessment is according to a recent survey conducted by Apoyo Consultoría that was recently highlighted by the head of Peru’s Ministry of Economy and Finance (MEF), Álex Contreras.
The MEF expects numbers to indicate a recovery in the third and fourth quarters of 2023. The Peruvian economy shows signs of improvement going forward. Apoyo Consultoría, Peru’s leading business consulting firm in economic, financial, and strategic matters, notes that its investment confidence indicator is at 17 points, the highest level since March 2019.
The same results are indicated with the 12-month economic expectations published by the Central Reserve Bank (BCR), the highest level in recent years, Contreras stated.
The Perception of Investing in Peru
The Apoyo Consultoría survey showed that Peru is positioned to date as the most attractive destination for investments in the region in 2024, commented the minister.
He maintained that this improvement in the confidence index in the country is also verified on an international scale. This was confirmed during the recent meetings with businessmen from Spain.
He said that many companies ratified their confidence in investing in Peru. Among those that stand out are those in the transportation, infrastructure, and energy sectors. “Something also important is that Peru has received the commitment of multilateral entities, both European and non-European, to support the financing of green projects in Peru. These include water and sanitation projects.”
Álex Contreras explained that he will meet in New York with risk agencies, international investors, and multilateral organizations to promote more interest in investing in Peru.
“Investments are already materializing. The worst capital outflow in Peru’s history was stopped, and record projects were awarded under the modality of public-private partnerships that will begin to be built. In addition, new business investment projects worth 12.5 billion dollars were recently announced. He stated that Peru will continue with the work to regain confidence and develop further foreign direct investment,” he stated.
The present months are crucial because companies prepare budgets and decide the projects they will develop in 2024, Contreras added.
An international tour
Furthermore, Minister Contreras highlighted that the international investors he met with in the United States are confident in continuing activities aimed at investing in Peru.
He said that as part of the tour he carried out in the United States, accompanying the President of the Republic, Dina Boluarte, he met with international business groups to discuss opportunities for investment in Peru, and the response was quite positive.
“Companies in the mining, infrastructure, and telecommunications sectors are interested in investing in Peru.” Many American companies that opted to invest in Peru expressed their confidence and positive view of Peru before President Boluarte and the group of ministers who accompanied her. Contreras confirms that good winds are blowing towards Peru.
He highlighted that the tour of the United States was “very fruitful” because it allowed government officials to contact investors, who are “global players, companies that have investments on an international scale.”
“This ratification of trust in investing in Peru will be reflected in more private investment, which the country wants most now. Twenty percent of private investment is foreign. That is why being here and involved in Peru’s economy is important,” he stated.
A chance to capture investment
The President of the Central Reserve Bank (BCR), Julio Velarde, maintained that Latin American countries can attract new investments to their economies due to the confrontation the United States and Europe have had with China commercially.
“Mexico, which has a significant industrial base and exports to the United States, and Costa Rica have benefited from this movement to ‘nearshore’ operations. However, no country in the region has taken full advantage of this enormous potential,” he stressed while participating in the Budget and General Account Commission of the Republic of Congress.
Additionally, he warned of a possible impact of citizen insecurity on the atmosphere for foreign direct investment. “Some businessmen hesitate to send their families abroad and, because of security concerns, they invest less,” he commented. However, Peru’s Ministry of Economy and Finance recently announced that it will allocate more than 200 million soles (USD 54 million) to strengthen citizen security.
The benefits of investing in Peru
In 2024, investing in Peru will offer an unparalleled opportunity for forward-thinking companies seeking sustainable growth in a dynamic market landscape. Peru, endowed with rich natural resources including copper, gold, and silver, has positioned itself as a pivotal player in the global commodities market. Moreover, the country’s strategic location as a nexus between South American markets presents a gateway for companies aiming to capitalize on the continent’s burgeoning consumer base. Recent infrastructural advancements, such as expanding the transportation network and modernizing ports, have further enhanced Peru’s attractiveness for foreign investment. Furthermore, Peru’s commitment to economic reforms, fostering a conducive business environment, and promoting innovation through public-private partnerships underscores its dedication to fostering long-term economic stability and growth. By leveraging Peru’s unique advantages and aligning with its progressive policies, companies stand to benefit from enhanced market access, operational efficiencies, and robust returns on investment. In essence, Peru emerges as a pole of opportunity, offering foreign direct investors a strategic advantage in navigating the complexities of the global economy and securing a prosperous future.