Trade between Peru and South Africa has grown rapidly since 2009, with the balance in all but one year favouring South Africa. “This has never bothered Peru,” says Peruvian ambassador to South Africa Daúl Matute-Mejía. “What is impor- tant is that we trade! My policy is to get South African exporters to Peru. And when they get there, they also see what Peru has to offer and end up importing from my country as well as exporting to it.”

In 2009, Peruvian exports to South Africa came to $28-million while the South American country’s imports from this country were worth $32-million. In 2010, Peru’s trade with South Africa saw its exports fall to $23-million but its imports rise to $58-million. In 2011, the figures were $55-million and $78-million respectively. It was in 2012 that the trade balance reversed, with Peruvian exports to South Africa jumping dramatically to $120-million and imports from South Africa declining somewhat to $72-million. To put in differently, total bilate- ral trade has gone from $60-million in 2009 to $81-million in 2010, to $133-million in 2011 and to $192-million in 2012. During the first half of this year, Peruvian imports from this country amounted to $86-million, clearly signalling that the growth trend is continuing. (These figures are all Peruvian data.)

Stimulating trade and investment has been a central economic policy of all of the Presidents of Peru since 2000, regardless of party. There is national consensus on the need to encourage trade and investment as key instruments for reducing (and, ultimately, eliminating) poverty.

“Peru has changed a lot in the past 22 years,” reports Matute-Meíja. “We have changed our investment laws, our tax laws, mining laws. There is no exchange control. Companies in Peru, whether local or foreign, can have accounts in nuevos soles (the Peruvian currency), dollars, euros – whatever they want. We have successfully attracted foreign investors.” In 2000, Peru’s total exports amounted to $4.8-billion; last year, they were almost exactly ten times greater, at $47-billion.

Over the past 13 years, the country has had an annual average growth rate of 6.7%, although the figure for this year might only be 5.6%, owing to the problems in Europe and the slowdown in China. Four decades ago, 65% of Peruvians lived in poverty; two decades ago, it was 55%; now it is close to 23%. “After 34 years of working hard, we have changed our country,” he affirms. “We have integrated people into the workforce and so rescued them from poverty. Unemployment now is only 6.5%. Peru today is another country. We hope to reduce poverty to 19% over the next three to four years.”

Peru is now a leading mining country, and metals form an important element in the country’s exports to South Africa. Copper exports to South Africa last year amounted to $64-million while that same year saw Peru sell gold worth $40-million to this country. But the South American country’s exports to South Africa also include some higher value-added products, such as colourants and diamond drill bits (although Peru does not produce any diamonds).

And a lot of Peruvian exports to South Africa are foodstuffs – tinned fish, frozen fish, seafood, fruit, cereals and asparagus (Peruvian asparagus exports to South Africa last year were valued at $600 000). “The South African market for Peruvian nonmining products is growing, because the South African middle class is growing,” says Matute-Mejía. “Also, Peru uses South Africa as a gateway to the Southern African Development Community. South Africa has a good distribution system.”

South African exports to Peru are led by mining equipment and mining products, including (nondiamond) drill bits, rock drills, electric detonators, percussion caps, safety fuses, chrome and ferromanganese, with the biggest single category being scaffolding, framing, props and shoring systems manufactured from iron and steel. Other exports include polypropylene, hot-laminated stainless steel, cold-laminated stainless steel and machinery parts.

“South Africa has not exploited opportunities in most of Latin America as well as it should have,” he observes. “Peru has lots of free trade agreements. South African companies that set up in Peru can benefit from these agreements, including into Asia-Pacific markets. Peru is one of the Latin American members of the Asia-Pacific Economic Cooperation, along with Mexico and Chile. We are in the Pacific Alliance – Peru, Mexico, Chile and Colombia. These are the fastest-growing economies in Latin America. Peru can be a gateway to both Latin America and the Asia-Pacific.” There are South African companies that have already bought orchards in Peru and are producing grapes and mangoes which they then export to China.