Living in Peru : your everyday companion

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.

Einstein, who wrote essays about physics since he was twelve years old, almost lost his interest in it when he went to study at a military school in Munich. The rigidity of the system did not motivate him to create. When he applied to a polytechnic school in Zurich, he was not admitted. However, when he entered a Swiss school to improve on his weaknesses, he developed the first experiment that would lead him to the Theory of Relativity. The school’s humanistic approach, stimulated the expression of his own creativity.

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?

During 2007, Peruvian handicrafts exports have been one of the most dynamic sectors. It is estimated that by the end of that year total exports of these goods might have reached US$142 million, including jewelry. This is explained by the fact that more and more people join this sector and are benefiting from the gains of foreign trade.

It is also important to note that this sector is very important in terms of job generation, especially in socioeconomic sectors C, D and E (lowest), mostly in rural areas of the country. Almost 2 million people are dedicated to handicrafts nationwide. Most of them work in groups or associations, establishing small business companies that, after proper preparation, can produce in a standard manner.

By Aldo Defilippi, Executive Director of AmCham Peru

U.S. Congress has decreed a bill about the inspection of 100% of merchandise, which is about to be signed by President Bush shortly. This bill requires that 100% of the containers shipped in foreign ports be inspected by non intrusive equipment or X-ray detection equipment in that same foreign port before it is loaded onto the ship.

This is the Container Security Initiative (CSI). This bill will enter into force by July 1st, 2012 and will imply that in the next 5 years a new inspection system should be installed in our ports if we want to keep on exporting to the United States. The European Union has already stated its position in relation to the complications that such a measure would bring in terms of trade facilitation, higher port costs, delays, etc.