In Peru, the free exchange and free trade principles exist: there are no quantitative restrictions or exchange controls. The import of certain goods is prohibited for health or safety reasons. Veterinary products, cosmetics and perfumes are required to be registered with the Ministry of Health (in Spanish). The import of raw materials, for transforming into exportable products, is not taxed (Regime of Temporary Admittance). There are 4 free trade zones: the zone of export treatment (in Chimbote, Ilo, Matarini, Paita and Trujillo), the tourist zones, the special trade zones (with 10% Customs duty and tax exemption) and the development zones. Peru has signed bilateral trade agreements with Bolivia, Ecuador and the United States and multilateral agreements with organisations such as the ALADI (in Spanish).
Customs Duties and Taxes on Imports
Peru applies a four level tariff regime: 4%, 7%, 12% and 20%. The country levies Customs duties of 4% on about 37% of the goods on its tariff list (2,603 codes, essentially covering intermediate products and their components), 7% on a certain number of capital goods and building materials, 12% on almost 43% of goods (3,029 codes), and 23% on about 11% of products that can be imported (762 codes mainly covering textiles, shoes and some agricultural products). The non weighted average Customs duty is 10.2%, whereas it was more than 60% in the mid 1990s. In addition, Peru imposes no quantitative restrictions on imports.
You must provide a document including the single import declaration, an attestation of loading, a commercial invoice, an inspection certificate, a certificate of origin, an insurance policy, an authorization certificate, an inventory, and any necessary special authorizations. The system of Customs management (SIGAD) validates the data and numbers the goods to determine the type of control.
Peruvian consumer behavior has evolved considerably over the last decade. The consumer is more interested in the components of a product before he buys it. If the product does not meet his expectations, he is more inclined to complain today, even if this attitude is still a very marginal phenomenon.
Consumer Profile and Purchasing Power
The Peruvian consumer today is more well-informed about market possibilities, as the majority of Peruvians have had technical or higher education. The consumer is willing to test new products. He is just as emotional as rational when he buys. He spends his spare time watching television (27%), listening to music (20%) or practicing a sport (10%).
There are three leading large distribution chains in Peru. The Wong Group consolidates 61% of the distribution market in Lima. Supermercados Peruanos consolidates 29% of the market in Lima and Tottus 10%. These three chains have based their activities on Lima and have only recently started to spread to the regions of Trujillo, Chiclayo and Arequipa.
Organizing Goods Transport
Main Useful Means of Transport
Peru has 69,941 km of roads, 10% of which are tarmac. The main roads are along the coast over 2,800 km, and the Inca Trail, which links Lima to the interior of the country. Considerable projects to improve the road network are underway. The railway network covers 1,876 km, 1,576 km of which have a 1,435 m gauge and 300 km have a 0.914 m gauge. The state of the network is poor. The port of Lima (Callao) is the biggest port in Peru. Peru has 8,600 km of waterways (tributaries of the Amazon and 300 km on Lake Titicaca). Air transport is often the only means to reach jungle areas inaccessible by road or the fastest way to reach some Andean populations. Secondary airports are those of Cuzco, Tacna, Arequipa, Iquitos, Ayacucho, Chiclao, Piura and Trujillo. Small airline companies offer regular flights between the country's cities. In 1994, 54 million tons of goods were transported by air.
Mining is one of Peru's main economic activities and the country's largest source of exports (24 % of total exports). Gold is the main product exported, followed by copper, zinc, lead and iron. The sector has experienced considerable development because of new investment made after the privatization and modernization of the many public companies. Peru has enormous reserves of raw materials including oil and gas.