Archive for the ‘Business’ Category
Friday, February 8th, 2008
Energy Minister Juan Valdivia announced a plan to renegotiate parts of an energy contract that will export natural gas from the Camisea gas fields, located in Peru’s south-east Amazon basin and thought to hold some of the largest undeveloped gas reserves in South America. Valdivia said they will sit down with Peru LNG, the consortium responsible for the second phase of the natural gas export project, to negotiate terms that would allot part of the supply for Peru’s internal market, daily El Comercio reported.
The Camisea gas fields were originally thought to hold 10.86 trillion cubic feet, TCF, of natural gas. However in early January, the Pluspetrol oil company told Peruvian authorities the gas fields have about 20 percent more than those estimates, holding 13.40 TCF of natural gas. (more…)
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Wednesday, February 6th, 2008
The World Bank’s International Finance Corporation, IFC, approved a $300 million loan on Tuesday for Peru LNG, the second phase of the Camisea natural gas export project requiring a total investment of $3.8 billion, the largest foreign direct investment in Peru’s history. The project has already received funding from the U.S. Export – Import Bank, which approved $250 million, and the Inter-American Development Bank, which was the first bank to brush off environmental and social concerns by authorizing $400 million in December 2007.
The project will create a 253-mile pipeline and a natural gas liquefaction plant and marine loading terminal some 105-miles south of Lima on Peru’s pacific coast. The pipeline will transport natural gas from the Camisea gas fields through an existing pipeline network to the LNG plant. It is expected to generate $230 million a year in incremental royalties and $90 million in income tax revenue for Peru’s government. Most of the natural gas will be exported with markets in Mexico and possibly Chile and the United States. (more…)
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Saturday, February 2nd, 2008
Justice Minister Rosario Fernández announced the commission that will evaluate and make recommendations on a privatization plan for Peru’s future prisons, in an attempt to address problems such as overcrowding. The commission, which has 30 days to produce its report, is led by Gonzalo Prialé Cevallos, who is accompanied by penal and public management specialists as well as engineers and fellow economists. Prialé, an economist and agro-exporter, is president of AFIN, the association for development of national infrastructure formed by members of Confiep, the confederation of national private businesses.
Peru’s prisons are currently managed by the National Penitentiary Institute, INPE. Under the new system, prison administration would be controlled by private companies under INPE’s supervision.
“Basically, we aren’t trying to resolve or correct the existing penitentiary problems, but rather find a formula so the future prison system will be more humane,” said Prialé. (more…)
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Friday, February 1st, 2008
Peru’s first biodiesel plant was inaugurated in Lima’s Lurín district on Thursday with an investment of $25 million. The general manager of the Peruvian company Heaven Petroleum Operations, Samir Abudayeh, said the plant will have an initial daily production of 120,000 gallons of biodiesel with a later production at 240,000 gallons a day, Radio Programas radio reported.
“With this plant, using Peruvian technology, we begin the era of biofuels in our country,” said Abudayeh. “Biodiesel will create a series of development poles at the national level in the agriculture and agro-industrial sectors”
Made from fat or vegetable oil, biodiesel is a clean burning alternative fuel compared to conventional diesel. With little or no modifications, it easily replaces petroleum diesel in compression-ignition engines, which includes cars, heavy equipment and boats. (more…)
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Tuesday, January 29th, 2008
Peru successfully concluded a free trade agreement with Canada on Saturday as both countries look to diversify their markets ahead of fears of a possible recession in the United States. Peru’s Foreign Trade and Tourism Minister, Mercedes Aráoz, sealed the deal with her Canadian counterpart, David Emerson, during the World Economic Forum in Davos, Switzerland, where they later made the announcement.
The agreement immediately eliminates tariffs on 97 percent of Peruvian exports to Canada, with the remaining tariffs to be shelved over three to seven years. The deal also eliminates tariffs on 94 percent of Canadian exports to Peru, with the rest to be lifted over a period of five to 10 years.
“It’s big news because it guarantees growth and Canadian investment in Peru,” said President Alan García on Saturday. “It guarantees that in 2008 we will have new room to grow, every time taking Peru’s name to better geographic places and economies around the world.” (more…)
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Thursday, January 24th, 2008
Chile’s Congress has rescinded the fast-track status of a Senate bill seeking free trade negotiations with Peru, citing Peru’s decision to file suite in the International Court of Justice in The Hague to settle the maritime border dispute between the two nations.
Peru’s Foreign Minister José Antonio Garcia Belaunde told reporters that Chilean lawmaker were only hurting their own country by annulling the free trade deal’s priority status. “This isn’t some kind of cooperation accord or a donation, but rather a commercial accord in which both parties expect to benefit,” he said. “The ones damaged by this will be on both sides of the border.
The maritime dispute dates back to the 1879 – 1883 War of the Pacific, in which Peru and Bolivia lost substantial territory to Chile. Central to the row is 38,000 square kilometers, or about 14,500 square miles, of fishing-rich sea which Chile currently controls.
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Wednesday, January 23rd, 2008
Formal employment has grown by almost 8 percent in Peru’s urban centers from November 2006 to November 2007. According to the Labor Ministry, the retail sector had the highest formal employment growth at 10.4 percent, followed by the industrial and service sectors with growth at 8.4 and 7.8 percent respectively.
Retail growth was reportedly due to an increase in business during the holiday season while employment growth in the service sector is attributed to teaching.
In Peru’s capital, Lima, industrial employment growth was due to an increase in textile business and manufacturing of tools and machines, including electro-mechanical instruments. In other urban centers, the industrial employment growth reportedly came from food and beverage companies.
The city of Chincha, located in the earthquake-devastated Ica Department, had the highest formal employment growth at 19 percent followed by Tacna, the capital of the southern Tacna Department, at 18.4 percent. In Lima, formal employment grew by 8.4 percent.
In some cities, however, opportunities in the formal economy decreased. For example, in the northern-coastal city of Chimbote, in Ancash Department, formal employment decreased by almost 2 percent.
While formal employment has reportedly increased, many Peruvians are still working in the informal economy, outside the purview of the government and without labor benefits.
A 2002 report by the National Institute for Statistics and Informatics, INEI, reported the scope of Peru’s informal economy. INEI reported that 4.3 million urban jobs, or 61.5 percent, were in the informal sector. About 1.8 million people in Lima, or 53.1 percent of the city’s possible labor force, had informal jobs
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Wednesday, January 23rd, 2008
Foreign Trade and Tourism Minister Mercedes Aráoz announced that negotiations for a bilateral free trade agreement with Canada will be finalized this weekend, as part of Peru’s efforts to diversify its market.
Aráoz said an agreement was nearly sealed during a Monday night video teleconference meeting, which settled in-depth and technical details, Agencia Andina reported. “We are going to meet this weekend,” said Aráoz “in order to finalize the details and be able to close the agreement.”
According to Foreign Affairs and International Trade Canada, trade between Peru and Canada totaled $2.38 billion in 2006. Peruvian exports to Canada were $2.1 billion, a 54.3 percent increase over 2005. Peru imported $289 million during the same period, a 9.1 percent increase over 2005.
Peru’s principal exports to Canada are gold, copper, asparagus and fishmeal, while its major imports are cereals, machinery, electrical equipment, leguminous vegetables and paper. (more…)
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Monday, January 21st, 2008
Peru and China have begun the first round of negotiations for a free trade agreement that could be ratified by November, according to Foreign Trade and Tourism Minister Mercedes Aráoz. Agencia Andina quoted Aráoz saying that Peruvian and Chinese officials will try to reach an agreement before the 2008 Asia Pacific Economic Cooperation summit scheduled for November in Lima.
“We want to reach a good agreement with our partners before the 2008 APEC summit,” said Aráoz. “It isn’t an obligation, but it would be a dream to quickly reach this type of an agreement.”
China is currently Peru’s second largest trade partner, as their bilateral economic and trade activities continue to expand. According to a FTA Joint Feasability Study, the bilateral trade volume totaled $3.9 billion in 2006, a 35 percent increase from 2005. (more…)
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Tuesday, January 15th, 2008
Agriculture Minister Ismael Benavides announced on Monday that his ministry will implement 20 new regulations intended to help Peru’s agricultural industry adapt to the free trade agreement with the United States. The regulations will be implemented by the end of March, reported daily El Comercio.
The first regulation will reportedly restructure the ministry and its decentralized offices, including the National Institute for Agrarian Research and the National Service for Agrarian Health. Promoting the forestry industry, cattle farming and further agricultural investment in the Andes will also be key goals, Benavides added.
“As well, we’ll define the responsibilities that were part of the Agriculture Ministry and which will now form part of the new Environment Ministry,” said Benavides. (more…)
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