Economic report of Peru (country report)

Economic Report of Peru Introduction

Peru is a Latin American country bing Pacific ocean . Its name is derived from an Indian word , which means land of abundance . Per has a 1 .5 percent . Peru per head GNI is about US 2360 . About 30 percent of its population is 0-14 years of age , while 63 percent of population is between 15 and 64 years of age . The while life expectancy is about 70 years (World Bank , 2005

During the last decade , there has been massive investment in country 's infrastructure , improving infant mortality

rate dropping form 54 to 26 between 1990 and 2000 , while the maternal mortality rate decreased from 265 to 185 per 100 ,000 . There was also increase in secondary school education reaching 74 percent in urban areas and 44 percent in rural areas . However poverty has been the rise increasing to 54 percent and extreme poverty has reached 24 percent of years . The table below shows detail . The country 81 percent population is Roman Catholic with few other minor sects and religions . Peru official language is Spanish and Quechua and have literacy rate of 87 percent (CIA factbook , 2005

Table 1

Source : World Bank , 2005

Economic Development Since 1960

In the post-World War II decades , Peru achieved an -average rate of growth and low level of inflation and rising exports of its diversified primary products . Its output per capita grew 2 .9 percent a year in the decade of the 1950s , and 3 .2 percent annually in the first half of the 1960s , compared with the regional growth rate of 2 .0 percent for these fifteen years . As of 1960 , income per capita was 17 percent above the median for Latin American countries . However , since the mid 1960s the economy ran into difficulties . The output per capita failed to grow from 1965 to 1988 , then fell below 1965 level in 1989 and 1990 . The previously moderate rate of inflation accelerated , balance of payments deficits became a chronic problem accumulating deep external debts for the country . Poverty worsened and political violence in the countryside and cities became increasingly intense . The economy and the society as a whole seemed to lose coherence and any sense of direction (World Bank 2005

Peru has mixed and developing economy composed mainly of manufacturing services , agriculture , and mining industries which were nationalized in 1960s and 1970s . In 1987 government nationalized its financial system Compared to its population , Peru GNP has not grown rapidly , however the country is rich in natural resources including copper , gold , silver and iron . Peru is not self-sufficient and has inadequate irrigation system Peru main trading partners are US , Japan , Germany . During late 1980s guerilla violence and increasing inflation created excessive budget deficits leading the country to almost bankruptcy , however the 1990s economic re-structuring changed the situation (World development indicators ,2004

The Peruvian economy is becoming market oriented after with its privatization of mining , power and telecommunication industries in 1990s , which also led to massive FDI (foreign direct investment ) and cooperation...