THE ECONOMY IN PERU IS CONTINUING TO BE IN A FAST-PACE RECOVERY ROAD
The growth for the month of May is 3.39%, this is after three consecutive months of low expansion, This is the first month that the economy of Peru shows a registered growth rate well above that recorded, indicated by the Ministry of Economy and Finance (MEF).
The head of the National Institute of Statistics and Information (INEI) Anibal Sanchez, said that the growth of production in May represents the second highest rate of expansion so far this year, after January (4.93%). The economy continues to record consecutive months of growth, which adss between January and May, an expansion of 1.96%, and YTD (June 2016 to May 2017) of 3%.
This May rebound had and impact on marketing and services, especially in the northern part of the country, following the collisons of the El Nino Costero phenomenon. "The commercial and services activities of the northern zone represents 7.5% of the GDP" and is estimaded to be sustained in the coming months. The growth in GDP is due to greater volume of total exports (12.8%); both traditional products such as fishmeal and fish oil, coffee, copper, gold showing an increase of 11.4%, and non-traditional products such as farming, fishing, metal-mechanics as well as iron and steel products of 17.9%.
The increases of domestic demand has given an increase in imports of non-durable consumer goods of more than 34.7%, and consumption with credit cards grew 0.87%. In terms of sectors, fisheries and telecommunications has achieved a growth well beyond expectations of 280.4% and 6.44% respectively.
These are indications that although there are domestic issues yet to be resolved, the economy of Peru is well in the path to a very fast pace recovery which is great news for foreign investment.
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ARGENTINA LIBERALIZES MARKET CONDITIONS
In an effort to strengthen the economy, the new government is opening their market to foreign investors by reducing export costs and eliminating various export duties, relaxing exchange control, floating the the Argentinian peso, and lifting restrictions on the repatriation on earnings and dividends. These will greatly assist current conditions in the energy and resources sector.
Current 5% taxes imposed on the energy and resources sectors has been removed. This was announced in San Juan and on twitter (see below)
"This is the end for mining taxes. We will help the sector generate more jobs."
“Eliminating export duties will have a direct benefit to the state. San Juan is one of the provinces with the largest mining resources in the country. It’s important to have a federal vision about those resources,” Jaime Berge, head of San Juan’s Mining Chamber, told Buenos Aires Herald.
Argentina produces silver, gold, copper, aluminum and lead. It also has important potash and uranium reserves.
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MENA (Middle East North Africa) Economies outlook for 2017
In the past, countries like Iran, Iraq, Turkey, Lebanon and others in the region, have had a slight improvement in their economic activity. This mainly due to a better position in their political and economic situation, and this is especially in Iraq where the government has taken control. This is a very important indicator for the region as it comes out of a recession. Due to the lifting of UN sanctions, Iran is becoming a very strong developing economy. Changes in US policy towards this region is giving great opportunities to other economies to improve a bi-lateral or multi-lateral trade relationship. Countries like Peru, Colombia, and Chile are already in developing workable trade policies to assist exporters in entering these markets. There will be new international agreements which will replace the TPP, more flexible and not oligopolistic in structure. Tough stance in trade partnership by certain traditional economy will not have the expected effect; rhetoric statements (my way or otherwise….) won’t work. We are in the 21st Century, and developing economies are important trade partners as they become stronger and less dependent to certain developed nations. Various economists estimate a decrease in inflation in the next 2 years. Australia is starting to look at these markets to expand from their traditional primary industry commodities into infrastructure and other products and services.
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