The May leader in International Mining magazine looks at Peru and its great potential. After praising Peru’s economic performance in the last decade and its capacity for recovery during the past global financial meltdown due to its solid economic base, the International Monetary Fund (IMF) forecasts that Peru’s economy should expand 6.25% this year and 6% in 2011.
Peru has opened negotiations in Melbourne, Australia to join the Trans-Pacific Partnership Free Trade Agreement (TPPA), which will allow it to consolidate its approach to the Asian-Pacific region. Martin Perez, Minister of Foreign Trade and Tourism said this agreement “would enable us to enter a very extensive market with a population of over 460 million with preferential tariffs.”
China is already an important market. Peruvian exports to China increased from 6% in 2000 to 17% in 2009. China is becoming a key player in the economic recovery of Latin America, remarked credit rating agency Standard & Poor’s. Lisa Schineller Associate Director of Sovereign Ratings for Latin America said that Peru’s export levels improved and domestic demand did not shrink like in other countries in the region.
The area of the regions of Ayacucho-Apurimac-Cuzco is likely to be the scene of the next mining boom in Peru due to several exploration and development projects scheduled in the area, according to Hans Flury, President of the National Society of Mining, Oil and Energy.
“There is no doubt that the central southern zone of the country will become the new mining centre in the next years and it will be an example of correct investment.” He stated that these three areas have approximately 17 mining exploration projects, and that results have been highly successful for the majority of them.
The most important ones are Las Bambas in Apurimac, where Xstrata Copper will invest some $1.5 billion and Southern Peru’s Los Chancas project. Also in Ayacucho there are some gold mining projects like the Catalina Huanca project. Meanwhile, Xstrata will invest some $700 million in the Antapaccay plan.
Other important projects in Cuzco are Constancia of Norsemont Peru (investment: $846 million), and El Quechua of Compañía Minera Quechua, among others.
“Investment in Las Bambas, Los Chancas, Apurimac Ferro and other mining projects of the central region is upwards of $7 billion, with just referential geological and geographical information,” he stated.
Taking advantage of the situation, he urged the government to improve infrastructure in the zone, particularly roads and railways. “We have to have the necessary infrastructure in place for when the extraction and production of minerals starts, and in this way the zone becomes more attractive yet.”