Relations with the USA traditionally had foreign policy priority for Peru. But while in 2007 30% of Peruvian exports to the USA were still accounted for, this fell to 15.1% of total exports in 2015. Only 20.6% of the imports came from the USA in 2015. After lengthy negotiations, the Trans-Pacific Trade Agreement TPP was signed between a dozen Pacific countries at the end of 2015. A number of tariff and investment barriers are being removed, making trade and business easier among these countries. However, this contract is highly controversial.
The People’s Republic of China has long since replaced the USA as its main trading partner. Peru obtained 22.7% of its imports from the Asian country in 2015 and delivered 22.1% of its exports to China. The free trade agreement with the People’s Republic came into force in 2010 and the volume of trade has doubled since then. The President Xi Jinping said during his visit to the APEC forum in front of the Peruvian Parliament that have more than 170 Chinese companies made investments of 18 billion US dollars in Peru. The newly elected President Kuczynski’s first trip abroad took him to China, and 18 contracts were signed during the last visit by the head of China.
According to computerannals, Peru is interested in deepening its relations with the Latin American countries, with Europe and with the countries of the Pacific region. Two major international summits took place in Lima in 2008, the summit of all states of the EU, Latin America and the Caribbean in May 2008 and the summit of the APEC (Asian-Pacific Economic Forum) from November 20 to 23, 2008 November 2016 the meeting of the 21 APEC countries took place again in Lima. This economic forum generates around 50% of the global gross domestic product. The theme of the event was “Qualitative Growth and Human Development” and was chaired by the President of Peru, Pedro Pablo, Kuczynski. The final declaration was a plea for free trade. This is to be understood as a request to the newly elected US President Trump.
The USA and the European Union are roughly on par as Peru’s foreign trade partners and investors. The country is interested in strengthening its economic ties with the EU.
The volume of trade with the EU has remained constant in recent years. In 2015 the EU’s imports amounted to 5 billion euros compared to 5.3 billion euros in 2013. In contrast, exports increased in the same period from 3.5 billion euros in 2013 to 3.7 billion in 2015. The majority of Peruvian exports (85%) to Europe is concentrated in six countries (Spain, Italy, Germany, Netherlands, Belgium and Great Britain). Europe is not only Peru’s second largest trading partner, but also the largest donor in development cooperation and the largest investor, especially in the banking and telecommunications sector (Telefónica).
Even if Germany is not a particularly important trading partner for Peru, economic relations are traditionally good. German exports to Peru in 2015 amounted to 834 million euros, compared to the previous year, sales of machines, metal products and rubber goods fell, while those of motor vehicles, chemicals, electrical equipment and pharmaceuticals increased. German imports from Peru amounted to 1.16 billion euros. The main import products are food, metals, ores, agricultural products and clothing.
The expansion of relations with the largest economy in South America, Brazil, is of great importance. The construction of the interoceanic strait, which has connected the Pacific with the Atlantic since 2010, has not contributed significantly to the economic exchange between the two countries, but has devoured 2 billion US dollars (twice as much as planned). The ex-President of Brazil Dilma Rousseff visited Peru four times during her tenure. She said that 70 companies in her country have invested approximately US $ 6 billion in Peru, making Peru third in terms of Brazilian foreign investment. Relations between Peru and Brazil are supported by the election The most promising presidential candidate in 2006 and 2011 was overshadowed by the Brazilian company Odebrecht, which is being investigated in three cases in Brazil for corruption allegations.
On October 26th, 1998, the peace agreement between Peru and Ecuador was signed, which draws a line under the 50-year-long border conflict that escalated into a border war in 1995. On May 15, 1999, with the Peace Treaty of Brasilia, the demarcation of the border was ended and bilateral development plans and projects were decided. 15 years later, the Peruvian Foreign Ministry took stock. The cabinets of both countries meet annually to discuss joint projects.
On November 13th, 1999, the foreign ministers of Peru and Chile signed an agreement on the implementation of outstanding clauses of the peace treaty of 1929, which normalized relations between the two countries. In 2008, the government of Peru filed a lawsuit on the controversial maritime border with the International Court of Justice in The Hague (ICJ). On January 27, 2014, the IHG announced its “Solomonic” judgment. This resulted in the new course of the sea border between the two countries. The newly elected President Bachelet will implement this judgment together with the Peruvian President Humala. Hopefully the border disputes between the two countries will soon be a thing of the past. At the end of November 2016, during the visit of the Peruvian President to the head of Chile, Michele Bachelet, it was decided to intensify cooperation between the two countries. From June next year binational ministerial meetings to coordinate joint measures are to take place on a regular basis. The cooperation within the Pacific Alliance is also to be promoted.
Meeting of the heads of state of Chile and Peru