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Peruvian Peaks: The small, poor country that made the right economic moves.
By Daniel Gross for Moneybox, on Slate, July 29, 2009
It's been a difficult 18 months for the global economy. Many of the largest economies in the world—Germany, Japan, the United Kingdom, the United States—have been mired in a slump. The downturn has swamped many smaller, developing economies. Even Australia, which hasn't seen its economy contract since the early 1990s, is threatening to go into recession. There are a few bright spots, of course. The juggernauts that are China and India are rolling along. But in the Western Hemisphere, it's been a grim tale from Tierra del Fuego in the south to Hudson Bay in the north. Reforming Argentina, resurgent Brazil, stable Chile—resource-dependent countries that have made great strides in recent years—and hard-luck Mexico, have all slipped into recession. The U.S. economy began to shrink in December 2007, although it may be now be bouncing back, and Canada seems to have endured a mild recession.
In the Western Hemisphere, one small country has outperformed its larger, richer, neighbors to the north. Its export-dependent economy has weathered the global credit tsunami in good shape. Its stock market, which took a big hit in 2008, has more than doubled this year, spurring investment firms to introduce products allowing Americans to invest there directly. Its public finances seem to be sound, and the authorities appear to be making the right countercyclical moves. What's the name of this mystery country that finds itself on an economic shining path? If you guessed Peru, you're right.
The small, poor country benefited from many of the same trends that propelled global growth during the recent expansion—the China-inspired demand for commodities were a godsend to a country that nature endowed with substantial natural resources. According to Bloomberg.com: "Peru is the world's third-largest producer of copper, zinc and tin, the No. 1 producer of silver and fishmeal and No. 5 in gold." (Moneybox hypothesizes that Peru is also the largest exporter of groups of musicians who play pipes in public spaces like Harvard Square in Cambridge, Mass., and Grand Central Station in New York City.) As a result, the Economist reported, "Peru's growth has exceeded that of most other countries in the region during the last seven years, driven by high global mineral prices and expanding output from the natural-resources sector, including from the huge Camisea natural-gas field." In 2008, according to the CIA World Factbook, Peru grew at a blistering 9.2 percent.
The article continues at http://www.slate.com/id/2223753/
The Mineral Industry of Peru
By Alfredo C. Gurmendi, courtesy of the U.S. Geological Survey (http://www.usgs.gov)
"In 2007, Peru occupied a leading position in the global production of the following mineral commodities, in alphabetical order, arsenic trioxide (fourth after China, Chile, and Morocco), bismuth (third after China and Mexico), copper (second after Chile), gold (fifth after Australia, South Africa, China, and the United States), lead (fourth after China, Australia, and the United States), molybdenum (fourth after the United States, China, and Chile), rhenium (fourth after Chile, Kazakhstan, and the United States), silver (first followed by Mexico and China), tin (third after China and Indonesia), and zinc (third after China and Australia)."
Read the full report at http://minerals.usgs.gov/minerals/pubs/country/2007/myb3-2007-pe.pdf
World Exploration Trends 2009 - Metals Economics Group (pdf)
Tendencias de Exploración Mundial - Versión en español (pdf)
These special reports for the PDAC International Convention are drawn from Metals Economics Group's annual study of nonferrous exploration activity. Corporate Exploration Strategies, which the PDAC acknowledges as "the primary source of information on exploration and mining statistics worldwide," examines the nonferrous exploration activities of all mining companies worldwide. Volume I provides a ten-year summary of trends in exploration spending and an industry-wide analysis of allocations by location, target, stage of development, and more. Volume II reports on each company's exploration budgets by country, target, and stage of development.
http://www.metalseconomics.com/default.htm
Peru: Hands Across the Amazon' by Walter Milano of BCP Securities, from The Emerging Market Advisor, January 12, 2010 |
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