LatinFinance - September/October 2015 - 28

Stacking up
Largest copper reserve countries and their production 2014
Copper production
Chile
Peru
Mexico
US
Russia
China
Poland

Metric tons

20
0,0
00

150
,00
0

100
,00
0

50
,00
0

0

0

1,0
00

2,0
00

3,0
00

4,0
00

5,0
00

Indonesia

Metric tons

Source: US Geological Survey

6.6%. Only 2.1% mentioned inflation and
still fewer, 2%, pointed to economic instability as the top issues for the next government. All candidates are promising more
police officers, more prisons and stiffer
laws to control crime.
The specter of corruption is also present. Of the top candidates, only Kuczynski
does not fall under a dark cloud. Fujimori is
hampered by the corruption that penetrated her father's government as well as questions about her own wealth, while García is
still dealing with a series of investigations
into his last administration. A trial involving the "sale" of presidential pardons,

LF: The Bank has maintained the interest rate at 3.25%. Is there
the possibility of a change?
JV: We are watching inflation. A large part of inflation is due to depreciation. We are monitoring this and if inflation does not respond as we
expect it, we will not hesitate in increasing the rate.
LF: How concerned are you about inflation?
JV: It is slightly above the top end of the target (3%), but this is due to
the supply factor. All the countries in the region are above their targets,
because of the depreciation. We are carefully monitoring this and will
react when necessary.
LF: What is your expectation for economic growth this year?
JV: I have to say that we have been surprised. We have three principal
pillars for recuperation - the primary sector, public investment and
private investment in infrastructure.
The primary sector is where we had expected, but with some problems in the oil and gas sector. Companies are producing less than forecast. The mining sector is performing as expected.
The other two pillars have not performed as forecast. Public invest-

28 L ATINFINA NCE.COM - September/October 2015

Copper reserves

Australia

6,0
00

Low tide
The strong possibility of low mineral
prices and a stagnant global economy that
will continue to depress export earnings
and limit investment are among the headwinds for Peru's next leader.
"We had a kind of long high tide economically, thanks to high mineral prices,
but now that the tide has receded we can
see all the debris that has been accumulating and needs a solution," says Tuesta.
Attracting investment, reviving stalled
infrastructure projects, and continuing
with reforms, particularly on the labor
front, will be critical issues. The outcome
of labor reform could be the most daunting given that the four top candidates all
backed repeal of labor reforms attempted
by the Humala government.
Security will likely focus high on the
agenda and could be an opening for some
second-tier candidates to make a splash,
including retired General Daniel Urresti,
a popular former interior minister in the
Humala government who represents Gana
Perú, and Ántero Flores-Aráoz, a defense
minister in García's second administration.
Citizen security - or lack thereof - was
the primary concern of 64.3% of voters in
a July survey by CPI, one of the principal
polling companies in Peru. Corruption
took the second slot, but at a wide gap of

hundreds of drug traffickers among them,
during his administration got underway
in July and could run for months, keeping
a high-profile corruption process in the
public eye. Toledo is under investigation
in an asset-laundering case that does not
involve his presidency, but questionable
real estate deals after he left office.
Sanborn says the winner will likely
emerge from the party that runs the best
campaign. "None of the candidates would
upset things. They are all saying the same
thing, pro-business, law and order, so
whoever says it best is likely going to win,"
she said. LF

ment has been disappointing, but we are expecting some recovery in the
second half the year. Private investment in infrastructure has been slow.
We have seen investment in the electricity sector and it is increasing, but
there have been problems with concessions. There have been delays, but
we are now seeing a reactivation.
Our biggest concern is that consumption starts to weaken, but thankfully this has not been the case.
LF: Are you concerned about political noise as the elections
approach?
JV: I do not see it. If the current crop of candidates remains the same, I
don't expect there to be a great deal of concern.
The current government, now in its final year, has a certain level of
tranquility to continue with policies to reduce red tape, unblock investments that have been stuck, but major reforms would require consensus
that will be hard to achieve.
LF: Are you optimistic?
JV: I am optimistic in the long run. No one is talking about irresponsible
fiscal or monetary policies. Interventionist models are a thing of the past. LF


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Table of Contents for the Digital Edition of LatinFinance - September/October 2015

Contents
LatinFinance - September/October 2015 - Cover1
LatinFinance - September/October 2015 - Cover2
LatinFinance - September/October 2015 - Contents
LatinFinance - September/October 2015 - 2
LatinFinance - September/October 2015 - 3
LatinFinance - September/October 2015 - 4
LatinFinance - September/October 2015 - 5
LatinFinance - September/October 2015 - 6
LatinFinance - September/October 2015 - 7
LatinFinance - September/October 2015 - 8
LatinFinance - September/October 2015 - 9
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LatinFinance - September/October 2015 - 11
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LatinFinance - September/October 2015 - 18
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LatinFinance - September/October 2015 - 31
LatinFinance - September/October 2015 - 32
LatinFinance - September/October 2015 - 32A
LatinFinance - September/October 2015 - 32B
LatinFinance - September/October 2015 - 33
LatinFinance - September/October 2015 - 34
LatinFinance - September/October 2015 - 35
LatinFinance - September/October 2015 - 36
LatinFinance - September/October 2015 - 37
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LatinFinance - September/October 2015 - 45
LatinFinance - September/October 2015 - 46
LatinFinance - September/October 2015 - 47
LatinFinance - September/October 2015 - 48
LatinFinance - September/October 2015 - G1
LatinFinance - September/October 2015 - G4
LatinFinance - September/October 2015 - G5
LatinFinance - September/October 2015 - G8
LatinFinance - September/October 2015 - 49
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LatinFinance - September/October 2015 - 97
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LatinFinance - September/October 2015 - 100
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LatinFinance - September/October 2015 - 103
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LatinFinance - September/October 2015 - 112
LatinFinance - September/October 2015 - Cover3
LatinFinance - September/October 2015 - Cover4
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