Peru's outlook could rely on Public Private Partnerships and Projects in Assets

By Espinosa Bellido Abogados

According to the International Monetary Fund (IMF), the Peruvian economy projects a growth rate of 8.5% for 2021. Although still awaiting the result of the June 6, 2021, presidential election, the country expects to keep track of the IMF projection through Public Private Partnerships (PPP) and Projects in Assets (PA), two investment tools that have been backed up in recent years by a legal framework, international investment treaties and the work of Peru’s Agency for the Promotion of Private Investment (PROINVERSIÓN).

Projects in Assets (PA) are an investment modality that Peru is using for the development of projects in sectors such as mining, real estate and telecommunications. One of the PA processes is related to the Ancón Industrial Park project, which consists of the construction of real estate infrastructure aimed at industrial companies of various scale located in Metropolitan Lima, as well as for direct foreign investment that seeks modern spaces with the full range of services and the desired connectivity that will allow them to operate under international standards and very competitive costs.

The project would have 1,338.22 ha, of which 53.49% would be developable land (715.74 ha). Said area, according to its use, would be divided into: industrial, commercial, technology transfer (I+D), contributions, public recreation area, services and truck center. The areas have been designed in order to optimally provide a series of services to the companies that settle in the PIA. Additionally, by virtue of coordination with other sectors, the installation of mobility and transport infrastructures is planned, both on a metropolitan and regional scale.

According to the IMF, Peru’ economy is expected to rebound in 2021, as COVID-19 restrictions could be gradually eased and activity could regain momentum led by domestic demand and historically favorable terms of trade. Under these assumptions, GDP growth would reach 8.5 percent in 2021. Although the outlook is still uncertain and downside risks prevail, policy buffers are ample and the IMF has commended Peru for prudent fiscal management, supported by fiscal rules.