Peru: Opportunity and challenge in the logistics sector

  • Currently Peru, as well as all Latin America countries, is going through a period of economic downturn, with more moderate growth rates than in other regions, which could indicate that it is not a suitable period to enter the Peruvian market.
    However, there are factors that indicate just the opposite: in 2014 the Peruvian GDP grew at a rate of 2.35%, the second highest growth in Latin America and it is expected that in 2015 may come to lead this growth.
    The country boasts of innumerable natural resources, a remarkable opening to the outside, a major economic and political stability and an emerging middle class.
    However, as throughout Latin America, the infrastructure deficiency is one major problem to overcome for the expansion of the economy and to consolidate the foundations for a sustained growth to solidify. It is this challenge that arises opportunities.
    There are obvious problems: Lima concentrates almost all economic activity of the country (more than 50% of Peru's GDP is generated in the region of Lima) and logistics costs inland and on the coast are extremely high, mainly due to poor infrastructure.
    In addition, the freight costs for intra-regional destinations are high, due to low efficiency and quality of transport and lengthy customs procedures in relation to Western countries.
    The major export sectors in Peru are: mining, fisheries and agriculture. However, in recent years and due to the global economic crisis, exports have been undergoing a continuous decrease.
    Peru is betting heavily on investment in infrastructure, with a planned investment by 2016 of 13,000 million euros, including the construction and renovation of the entire transport network: roads, ports, railways, subways and airports.
    On the other hand, Peru enjoys superb location in the center of the Pacific Alliance countries (Chile, Peru, Colombia, Mexico) and as a means of natural output of interior goods production from Brazil to Asia.
    In addition to all this, has a port with the 3rd largest traffic of containers of all of South America: the port of Callao moves 1,856,020 annual TEU.
    For example, in the fruit and vegetable sector there are great opportunities, for the production of fruits and vegetables is offset from all other producing countries. So for the past five years tripled exports of fresh fruits and vegetables such as: mango, avocado, grapes and fresh asparagus.
    In the current context of poor connections and hight logistic costs if one is to survive in Peru, it is essential the election of a suitable logistics operator that fulfills a triple objective: reduce costs, minimize transport time and coordinate all logistics processes (one stop shop) .

    Alan Almeida