Wall Street celebrates Peru Day

Peru’s new logo on the New York Stock Exchange. (Photo: NYSE)
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Among the principal speakers of “Peru Day” were the finance minister, Ismael Benavides Ferreyros, and the central bank president, Julio Velarde, both who highlighted and reiterated throughout the day Peru’s 8.8% GDP growth in 2010 and their forecast for 7% growth this year. For the first trimester of 2011, the central bank expects an expansion of 9.2%, Velarde said.

Gathered in the a large room in the sixth floor of NYSE Euronext, attendees drank pisco, Peru’s flagship drink, and ate asparagus, of which Peru is the main global exporter.

With respect to inflation, which in February measured at 2.23% compared to last year, Velarde said they hoped to close the year at close to 3%, the maximum level proposed by the central bank for 2011.

Inflation is very controlled,” Velarde said in an interview with The Wall Street Journal Americas.
However, the bank head recognized that Middle East conflicts, which are producing a rise in oil prices, and the increase of food prices on a global scale, could put pressure on the Peruvian economy.

“We have our eye on the international situation,” he added. “Some storm clouds have begun to appear … We may continue with a cycle of monetary adjustments.”

Last Thursday, March 10, the central bank again bumped up its rate 25 percentage points to 3.75%, after similar changed in January in February. Velarde said that the priority in Peru continues being to control inflation.

"Tremendous" internal demand

Among the Peruvian companies present at the event were Credicorp Ltd., the largest financial holding in the country, whose main division is Banco de Crédito del Perú, owner of 31.5% of the market share.
Credicorp’s executive president, Walter Bayly, pointed out the internal demand in goods and services, driven by a growing middle class.

“The demand is tremendous,” Bayly said.

Credicorp was the first Peruvian company to list actions in the NYSE, back in 1995. It’s price closed Friday with an increase of 1.54% to $107.18.

During an interview, Minister Ismael Benavides said that since 2002, accumulative economic growth is more than 70%, he declared.

“Growth is assured for the upcoming years,” Benavides said.

Latin America on Wall Street

Peru is the sixth Latin American country to receive a day on Wall Street, after Argentina, Brazil, Chile, Colombia and Mexico.

“The event has been extremely successful,” said Alexandre L. Ibrahim, NYSE Euronext regional chief for Latin America, Bermuda and the Caribbean. “U.S. investors have been able to see the potential that Peru has.”

Ibrahim also said he hopes to see more Peruvian companies listed on the NYSE. For now, there are only three. Asides from Credicorp, there are Compañía de Minas Buenaventura S.A. and Southern Copper Corp., controlled by Grupo México. The three firms add to a market capitalization of $55.7 billion, according to the New York exchange.

In compaison, Chile has 11 companies on Wall Street with a joined value of $88.8 billion and Colombia has two that add up to $95.2 billion. Brazil is the Latin American country with the most presence, with 29 listed companies and a total market value of $946.7 billion.

Ibrahim said that the Latin American on the NYSE — which were just four in 1950, seven in 1992 and 56 in 1995 — show off an average daily liquidity of more than $4.3 billion.

“Purchases and sales are extremely liquid. Among non-U.S. stocks, it’s our most important region,” the executive stated.