Living in Peru : your everyday companion

Kosher is a Hebrew word that means appropriate or permitted and it is commonly used when referring to the allowed food for the people that observe the dietetic regulations of the Jewish Orthodox. And even though the Jewish colony in Peru is very small, in countries like the U.S., the Kosher market can represent a very interesting alternative. And in spite of the Jewish population in the U.S., being extensive they are not necessarily the only consumers of this market, Muslims and Adventists as well as vegetarians and lactose intolerants are also regular buyers.

Conscious as they are, of an alarming increase of obese people living in the United States, a vast array of advertising campaigns exist in that country, inviting consumers to participate in a healthier and better diet instructing them to include a larger number of vegetables and fruits in their eating habits. This positive change generates a great opportunity for countries like Peru, who now have a competitive edge to export these type of products which in turn, count with preferential access to the market. But, in spite of having all sorts of production advantages, certain specific products are still priced and taxed very highly, which presents a notorious limitation for their importation from countries who do not happen to have the same preferential access with the U.S.

Onions are regularly known for their capacity of making one cry as they cut them opened. But those particular onions destined to be exported, often make us smile instead of crying, due to their favorable usage and the sustained growth they provide in the sales market abroad.

During the years 2003 to 2007, the Peruvian onion exports have grown in 95.9%, reaching only during the last year, the sum of 22.2 million dollars. Unquestionably, our most important markets are the U.S., Chile and Holland; with the U.S. being the most important destination of them all, receiving around 86% of the worldwide onion exports during the year 2007.

When a new industry starts brewing an export idea, it is the procedure to create a detailed plan with the specific characteristics of the products, the country of destination, the demand, and requirements to enter the market, the sales strategy, amongst many other things. Another important point to consider in the evaluation and many times fundamental in the decision to export, is the adequate financial opportunity, especially among those entrepreneurs with good ideas but no real capital to initiate their export adventure. Nowadays, though and, thanks to the increasing credit opportunities businessmen who have successfully identified a business idea don’t have to worry about anything else.

The coming free trade that is about to happen with the U.S.-Peru Trade Promotion Agreements, will allow Peru to have 80% of its goods completely tariff free and the rest, will be eliminated in settlements during the course of the next ten years. With this liberalization, U.S. imports will be cheaper, which will in turn raise the competitiveness amongst Peruvian industries placing raw materials and equipment at lower prices for their manufacturers. Let’s not forget that the majority of taxes on the Peruvian imports from the U.S. range from 6% to 12%, while other goods are at 20%. Nevertheless, the U.S. is one of Peru’s basic providers, concentrating 18% --approximately of the total imported goods by Peru.

Over the last weeks, we have been exposed first to troublesome, and then disastrous and contradictory news which could affect negatively our commercial trade if we want to take advantage of the U.S.-Peru Trade Promotion Agreement (PTPA). Despite promises by port authority to decongest shipping traffic in the port of Callao, various shipping lines have been forced to increase their loading and handling charges to those vessels that sight land in Callao, as of March 15, 2008, by about 128 Euros, or 200 U.S. dollars per container in Callao, using port congestion as their excuse for this increase. Already weeks ago, 90% of the shipping lines anticipating problems decided to reduce lifting of some tonnage in Callao because they believed that the “Enapu” measures, established to resolve the traffic congestion, were actually not giving the expected results.

The Hispanic market in the United States increasingly demands more non-pharmaceutical products that might complement any medical treatment prescribed by a doctor. For example, herbal medicine in order to control diabetes or high blood pressure.

Precisely, the community of diabetic and people with high blood pressure in the United States is the one with the highest growth rate in the world, and a significant portion of them are Hispanic individuals.

How to help Small Businesses take the great leap into foreign markets? Through “Exporta Fácil”. This initiative, implemented thanks to good coordination between the private and public sector, simplifies redtape at customs procedures. Hence, now it is even possible to send merchandise to other markets from home or office thanks to the Internet and the joint work that the Customs Administration Authority (SUNAT) along with other exports promotion organisations have been doing.

Peruvian coffee keeps conquering consumers in the world and especially in the United States. Because of that, coffee is one of Peru's main agro-industrial exports. Despite the crisis and constant ups and downs in the coffee market during 2007, the leadership of that product in the ranking of Peruvian exports (fourth place) has remained constant.

Therefore, the approval of the U.S-Peru Trade Promotion Agreement opens a window of opportunity for projecting a further increase in the growth of the exportation of this product to the United States, and the expansion of chances for converting Peruvian coffee one of the favorites of American consumers.

What do ketchup, baby food and paper have in common? These three products use starch in their preparation. Starch, has applications in the food industry, the paper industry, mining and even the pharma industry. Even though starch is normally extracted from potatoes, corn, wheat or manioc, a group of students from Universidad del Pacifico have laid eyes upon an Andean root that might as well be a tough competitor: the arracacha.

What is the arracacha?