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					INVESTMENT OPPORTUNITIES IN
  INVESTMENT OPPORTUNITIES IN   PERU


                           May 2007
                                   PERU OFFERS:

Maintaining the basic
macroeconomic equilibriums                    GDP Growth of 8% for 2006 and
 Inflation between 1,5% and                  expected to be close to 8% for
   3,8% in the last 7 years.                  the next years.
 Fiscal Surplus of 2%
   forecasted for 2006.

An economy, working                           CAN, APEC, Mercosur,
within the globalization process              European Union and the United
and with access to regional                   States of America with annual
commercial blocks.                            commercial exchange greater
Stable and favorable                          than US$ 38 600 MM.
investment climate.
Investment policies based on                  Legal Stability
international principles.                     Agreements.
                                              32 International Investment
                                              Agreements.
Investment plays an important role in the country’s Economic Growth
                   and signals a promising future

                                                                                         2004      2005   2006
      GDP (var%)                                                                          4,8       6,4   8,03
      Private Investment (var %)                                                          9,1      13,9   20,1
      Public Investment (var %)                                                           5,7      12,2   13,0
      Employment in companies with over 10 employees (var %)                              2,7       4,5    7,3

      Exports (var % en US$)                                                              40,9     35,3    36,9
      Imports of capital goods (var % in US $)                                            19,6     29,6    35,4
      GDP of the construction sector (var %)                                               4,7      8,4    14,7
      Tax Collection (var %)                                                              13,6     14,3    27,8

      Credit System of the Private Finnancial Sector                                       4,7      7,9    16,6
      Pensions Funds (var%)                                                               17,5     25,5    41,3
      IGBVL General Index of the Stock Exchange Market of Lima
      (var %)                                                                             52,3     29,4   168,3


Source: Central Reserve Bank of Peru, National Institute of Statistic and Information and SUNAT:
Sustainable economic growth with annual forecasted
               rate greater than 8%


                                          8                                                              Peru
                                                                                                                        8,03

                                                                                                                    6,4
                                          6
                                                                                                       5,2     5,2
                   (Annual variation %)
      GDP Growth




                                                                                                             3,9
                                          4



                                                                                      Developed
                                          2

                                                              World

                                          0
                                              80   82   84   86   88   90   92   94    96   98    00    02         04     06


  Source: International Monetary Fund and the Central Reserve Bank of Peru.
  *Forecasted by Central Reserve Bank of Peru (9th February 2007), Ministry of
  Economy and Finance and the National Institute of Statistic and Information.
Annual Exports growth greater than 30%                                                     Accompanied by private
                                                                                             investment growth
                                                                                            (average annual % variation)

                                                                              25.0          Private Investment grew
                                                               23 750
                                                                        0,7                 20,1% in 2006*
 22 000                                                                       20.0
                                                                        0,6
                                                                                                                    Private
                                                      17 336                                                      Investment
 17 000                                                                 0,5
                                                                              15.0
                                             12 809                     0,4
 12 000                                       41%               37%     0,3   10.0
                                     9 090             35%
          6 955    7 026     7 714
                                                                        0,2
  7 000                                                                        5.0
                                      18%
                                                                        0,1
                              10%
  2 000                 1%                                              0      0.0
           2000     2001      2002    2003     2004    2005     2006


          Exports in millons US$"       % Exports Growth (base 2000)"          -5.0


                                                                              -10.0




                                                                                                                          05



                                                                                                                               06
                                                                                      01



                                                                                              02




                                                                                                                 04
                                                                                                        03
Source: Central Reserve Bank of Peru.
* Forecasted
                  Rise in the commercial                                      Increase in the imports of capital
                         exchange                                                           Goods
                            (Millions of US$)                                            ( Millions of US$)



40 000
                                                                       4500
35 000                                                                 4000

30 000                                                                 3500

25 000
                                                                       3000
                                                                       2500
20 000
                                                                       2000
15 000
                                                                                                         Capital goods for
                                                                       1500
                                                                                                              the Industry
10 000
                                                                       1000
 5 000                                                                          Transport Equipment
                                                                       500
    0                                                                    0                                            Others
         1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006
                                                                         1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006
           Total Exports (US $ mill.)     Total Imports (US $ mill.)



         Source: Central Reserve Bank of Peru.
   Peru is progressively reducing its
              fiscal deficit                                          By increasing its central government
                            (% of GDP)                                            tax revenues
                                                 2,5         14 000                                                                               0,35
2,5                                                                                                                                      13 134

2,0                                                                                                                             12 123            0,3
                                                             12 000                                                                       31,1%
1,5                                                                                                                                               0,25
                                                                                                                       10 247
                                                             10 000                                                                               0,2
1,0                                                                                                            8 915
                                                                      8 038                                                      18,3%            0,15
0,5                                                                                            7 696   7 821            14,9%
                                                       0.0    8 000                    7 501
                                                                              6 968                            14,0%                              0,1
0,0                                                                                                                                               0,05
                                                              6 000
                                                                                        7,7%
-0,5                                                                                           2,6%    1,6%                                       0
                                          -0,4                4 000                                                                               -0,05
-1,0
                                                                                                                                                  -0,1
-1,5                                                          2 000
                                   -1,1                                       -13,3%                                                              -0,15
-2,0                                                             0                                                                                -0,2
                            -1,7
                     -2,3                                             1998    1999     2000    2001    2002    2003    2004     2005     2006
-2,5          -2,5
                                                                              Central Government Tax Revenues (in US$ MM)
-3,0
                                                                              % Annual change in the Central Government Tax Revenues
-3,5   -3,3
       2000 2001 2002 2003 2004 2005 2006 2007*
 Source Central Reserve Bank of Peru.
 * Forecasted by the Ministry of Economics and Finance            Source: SUNAT
                 ... in a framework of macroeconomic stability...
               Exchange rate in Latin America                                                                             Inflation in Latin America
                   (Index January 2001=100)


                                                      Peru                                                                                                            Peru
 205
                                                      Brasil                                                                                                          Argentina
                                                                                                            30
 185                                                  Chile                                                                                                           Brasil
                                                                                                            25                                                        Chile
                                                      Colombia




                                                                           Variación anual
 165                                                  Mexico                                                                                                          Mexico




                                                                                             (Porcentaje)
                                                                                                            20

 145                                                                                                        15


 125                                                                                                        10

                                                                                                             5
 105

                                                                                                             0
   85                                                                                                             2000




                                                                                                                             2001




                                                                                                                                                               2004




                                                                                                                                                                               2005
                                                                                                                                         2002




                                                                                                                                                    2003
        E-01




                                 A-03
                    A-02




                                                                    N-06




                                                                                                            -5
                                              N-04




                                                             M-06




                                                                                                             Source: Central Reserve Bank of Peru, Chile, Mexico and Argentina.
Source: Bloomberg and Central Reserve Bank of Peru.                                                          Until October 2006
                                             With increasing Net International                                    The careful and responsible management of our
                                           Reserves that represent more than 12                                    economic program has allowed us to keep our
                                                    months of imports                                            country risk index among the lowest in the region.




                                                                                                 17 275
                                                   18 000                                                0,5
                                                   16 000                                 14 097         0,45




                                                                                                                  JP Morgan Index EMBI+**
                                                   14 000                          12 681                0,4                                700
                                                                                                         0,35
                                                   12 000
                                                                      9 598 10 194                                                          600
                                                                                                         0,3                                                                                                                                EMBI+ Peru                                             Latinamerica
                                                   10 000 8 180 8 613                              22,5%                                    500
Net International Reserves




                                                                                                         0,25
                                                    8 000                                                                                   400
                                                                                                         0,2
                                                    6 000                           24,4% 11,2%                                             300
                                                                       11,4%                             0,15
                             (Milions of dollars




                                                    4 000                    6,2%                                                           200
                                                                                                         0,1
                                                    2 000                                                                                   100
                                                                                                         0,05
                                                                 5,3%




                                                                                                                                                                                                                                                                                 Abr-06




                                                                                                                                                                                                                                                                                                                                                 Abr-07
                                                                                                                                                                    Ago-04




                                                                                                                                                                                                                                   Ago-05




                                                                                                                                                                                                                                                                                                    Ago-06
                                                                                                                                                                                      Nov-04




                                                                                                                                                                                                                                                      Nov-05




                                                                                                                                                                                                                                                                                                                      Nov-06
                                                                                                                                                  May-04
                                                                                                                                                           Jul-04




                                                                                                                                                                                                                          Jun-05




                                                                                                                                                                                                                                                                                          Jun-06
                                                                                                                                                                                               Ene-05


                                                                                                                                                                                                                 May-05




                                                                                                                                                                                                                                                               Ene-06




                                                                                                                                                                                                                                                                                                             Sep-06
                                                                                                                                                                                                                                                                        Feb-06




                                                                                                                                                                                                                                                                                                                                        Feb-07
                                                                                                                                                                             Oct-04




                                                                                                                                                                                                                                             Oct-05
                                                                                                                                                                                                        Mar-05




                                                                                                                                                                                                                                                                                                                               Dic-06
                                                        0                                                0
                                                          2000 2001 2002 2003 2004 2005 2006

                                                              Net International Reserves (in US$ Millions)"
                                                              Annual Variation


                                                                                                                                                                                                                                                      Updated 17 April, 2007


                                  Source: Central Reserve Bank of Peru.                                         Source: Bloomberg
              Just one step away from the Investment Grade

                S&P/ Moody's Characterstic                             Latin American Ranking
                Fitch
                 AAA      Aaa   Risk free
                 AA+      Aa1                              Countries    S&P       Fitch    Moody's
                                Superior
                  AA      Aa2
                 AA-      Aa3                             Mexico         BBB       BBB      Baa1
Investment        A+       A1
Grade
                   A       A2   High capacity of          Chile           A         A        A2
                                repayment
                  A-       A3                             Brazil         BB+       BB+      Ba2
                BBB+     Baa1
                 BBB     Baa2
                                Moderate capacity of      Peru           BB+       BB+      Ba3
                                repayment
                BBB-     Baa3                             Colombia       BB+       BB       Ba2
Peru close       BB+      Ba1                             Venezuela      BB-       BB-       B2
to the                           Some capacity of
                  BB      Ba2    repayment
investment       BB-      Ba3                             Argentina       B+        B        B3
grade
                  B+       B1   High uncertainty in the   Bolivia         B-        B-       B3
                   B       B2   capacity of repayment
                  B-       B3                             Ecuador       CCC+        B-      Caa2
                CCC+     Caa1
                                Highly vulnerable
                 CCC     Caa2   to default
                CCC-     Caa3
                   D     Ca     Default


     Source: Bloomberg
 Peru offers a favorable legal framework for foreign
                    investment ...
 Non discriminatory treatment.
 Irrestrictive access to most economic sectors.
 No performance requirements.
 Free transfer of capital.
 Free competition.
 Guarantee for Private Property
 Freedom to purchase stocks from locals.

 Freedom to access internal and external credit.

 Freedom to pay royalties.

 Network of investments agreements and member of ICSID and MIGA

  Legal Framework: Constitutional provisions, “Law for the Promotion of Foreign Investment”, Legislative Decree N° 662,
  “Framework Law for Private Investment Growth”, Legislative Decree N° 757, “Law for the Promotion of Private Investment
  in Infrastructure and Public Service Works”, Approved by Supreme Decree N° 059-96-PCM
With a legal system that guarantees basic rules and
            statutes that will not change

       For national and foreign             and his receiving company
       investments


 • National treatment                      • Recruitment regimes
 • Free availability and remittance of     • Regimes for the promotion of
   foreign currency*                         exports
 • Income tax rules applicable to          • Income Tax Regime.
   dividends.

During ten years.
In case of concession, the term is subject to the term of contract (60 years
maximum)
The only requirement: minimum investment of US$ 5 Million (US$ 10 Million in
mining and hydrocarbon sectors)


 *With capitals coming from abroad
            With a stable tax regime, which main taxes are:

                               Tax                                                       Applicable Rate

       I                                                                                          30%
       n     Corporate profit
                                                                            Agriculture and aquaculture 15%
       c
       o     Dividends                                                                            4,1%
       m     Royalties                                                                            30%
       e     Interests                                                                           4,99%
       Value Added Tax (VAT)                                                                      19%

       Financial Transactions Tax                                                   0.08% throughout 2007

       Excise Tax (*)                                                    Varies up to 125% in a few products




Note: * Burden goods: fuels, luxury goods, liquors and cigarettes


Legislative Decree No. 973 (12.03.07) standardizes the treatment for all economic activities regarding the advance recovery of the value
added tax (VAT). It will come into force and effect the first business day of the month following the 90 calendar days that may take for this
Decree’s regulations to be prepared and published. It is established that tax payers who purchase capital assets but do not start
operations, within the framework of investment contracts subscribed with the State, will be able to recover the VAT paid in said purchases.
 and a reduced tariff structure and low tariff
 dispersion…

   TARIFF LEVELS AD-
                                                %
        VALOREM +         TARIFF LINES
      SURCHARGES


           0                         3 028    43,29%
          12                         2 843    40,65%
          17                             48   0,69%
          20                          759     10,85%
          25                          316     4,52%
         Total                       6 994    100.00%
SIMPLE AVERAGE APPLIED TARIFF RATE             8.29




Source: SUNAT
Free market access to:
 Andean Community of Nations
 Chile                                    Peru has concluded the
 MERCOSUR                                   negotiations for the
                                              Trade Promotion
 Mexico
                                            Agreement (TPA) with
 United States                               the United States
 European Union
 Thailand




Trade Promotion Agreement with Singapore
under negotiations
Peru has the largest Chinese population in South America


     The Chinese came to Peru in the second half of the 19th century.
      Nowadays 15% of the country's total population has some Chinese
      ancestry.

     The Chinese influence in Peru is still very noticeable, especially in
      the culinary field.
         Factors promoting trade and investment

           China                                 Peru

1. Need of inputs to keep          1. Great source of inputs.
   growth rates.

2. It requires supply sources      2. Source of water and energy,
   with added value because of        besides the ability to transform
   the lack of water and energy.      raw material.

3. Availability of funds.          3. Need of investments to develop
                                      infrastructure.

4. Its high volumes of             4. Demand of value added
   production justify the             products.
   development of added value
   proudcts.
                Bilateral trade (US$ million)


4.000                                                     3.639
3.500
                                                  2.924
3.000

2.500
                                          2.002
2.000

1.500                             1.321
                          1.063
1.000     732      779

  500

    0
         2000      2001   2002    2003    2004    2005    2006




Source: SUNAT
                        Bilateral trade (US$ million)

2.500                                                 2.271

2.000
                                                              Peru exports to China
1.500                                                 1.368
                                                              China exports to Peru

1.000


 500


   0
        2000     2001     2002   2003   2004   2005   2006



        Source: SUNAT
                Bilateral trade – principal products

     Principal exports from                    Principal imports from
         Peru to China                                 China
 Flour, powder and "pellets" of fish.    Domestic appliances
 Copper, zinc, molybdenum, lead          Machines for the processing of
  and concentrates.                        information
 Preparations and conserves of           Motorcycles
  mollusks                                Parts and accessories of machinery
 Raw Oils of oil                         Devices of telecommunication
                                          Units of Memory
                                          Textiles
                                          Tires for cars and trucks
                                          Video cameras
          Bilateral trade – exporters & importers

    Main exporting firms              Main importing firms

 COMPANIA MINERA ANTAMINA       SAGA FALABELLA S A
  S.A
                                 LG ELECTRONICS PERU S.A.
 CONSORCIO MINERO S A CORMIN
                                 DELTRON INTERNATIONAL S A
 TEAM EXPORT S.A.C.
                                 SONY SUCURSAL DEL PERU
 SOUTHERN PERU COPPER
                                 IMPORTACIONES HIRAOKA S.A.C.
  CORPORATION
                                 NEXTEL DEL PERU S.A.
 BHP BILLITON TINTAYA S.A.
                                 TECH DATA PERU S.A.C.
 AYS S.A.
                                 PROCTER & GAMBLE PERU S.R.L.
 SHOUGANG HIERRO PERU S.A.A.
                                 TIENDAS POR DEPARTAMENTO
 VOLCAN COMPANIA MINERA
                                  RIPLEY S.A.
  S.A.A.
                                 TIM PERU SAC
 CIA MINERA RAURA S A
 CORPORACION PESQUERA INCA
  SA
Investment up to 2006: US$250.000.000

     Sectors            Principal Investors

    Commerce        Shougang Corporation
    Finance         Chen Kuo Ksiung
    Fishing         China National Import and Export
    Hydrocarbon      Commodities Inspection Corp
    Mining          HSBC Latin America Holdings Limited
    Services        Hsiang Sheng Huo
    Tourism         Qixin Su
                     Lin Zhang
          Peru


Strong figures
                 Strategic location



     Excellent opportunities

				
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