Category: Peru

Peruvian presidential hopeful and National Party candidate, Ollanta Humala, has overtaken conservative rival Lourdes Flores in the polls for the first time, ahead of elections on April 9. Flores fell back from 31% to 28% of the vote, while Humala rose from 30% to 32%. Humala is running on a platform that proposes limiting foreign investment and introducing higher corporate tax.

UK and Hong Kong-based financial giant HSBC has made a formal application to Peru’s banking superintendency to set up operations in that country. It is thought the bank may be up and running by August this year. Peru currently has 12 banks and the government is open to increasing competition. HSBC had expressed an interest last year in entering Peru’s financial market as part of a move to expand its overall presence in the region. HSBC already operates in Argentina, Brazil and Mexico. Last week it agreed to buy the assets of Lloyds TSB in Paraguay for $15 million.

After taking control last week of one of the country’s major steel-producer, SiderPeru, the government is to push ahead with its privatization. Last Friday, the Peruvian state investment agency, ProInversión, paid $53 million for 56.04% of the company, based in northern Peru, following the failure of private owners Sider Corp to meet investment obligations. In 1996, Siderperu was bought by Sider Corp, a group including Acerco and Wiese Inversiones Financieras, part of Banco Wiese Sudameris. The Group has only paid $110.7 million of the $186.2 million originally agreed with the government, while its outstanding debt, including payments, have risen to $237.3 million.

Lourdes Flores, conservative presidential candidate and the front-runner for next month’s elections in Peru, has lost further ground to rival Ollanta Humala of the Peruvian Nationalist Party, according to the latest opinion polls. Humala’s share of the vote has risen from 23.9% in January to 25.5%, while Flores’ backing has fallen from 37.8% to 34.1% over the same period. Peru’s elections are slated to take place on April 9.

Peru has set the date of March 31 to auction its second fixed-line telecoms license in a bid to open up the market to competition. The 25-year license will cover fixed-line telephony and internet access for Lima and Callao. Currently there is only one operator – an affiliate of Spanish company Telefónica, which has dominated the market since 1994. State investment company ProInversión is managing the sale. Interested bidders include Telefónica, Americatel and Millicom.

Petroleum exploration company Pluspetrol Peru Corp, says it is planning to issue local currency bonds worth up to $250 million. The company said it would likely issue a first tranche ahead of the country’s elections on April 9. Pluspetrol Peru Corp is the local subsidiary of Argentine oil company Pluspetrol. It oversees exploration and extraction in the Camisea natural gas field in southern Peru.

Peru’s economy expanded by 6.67% last year, the highest growth rate in eight years, according to the national institute of statistics and data (INEI). Construction accounted for the highest growth sector expanding 8.72%, followed by mining and hydrocarbons, up 8.65% against 5.40% in 2004. Manufacturing grew by 7% during 2005, the highest growth rate of this sector since 1994. Trade and other services were up by 6.17% and 6.77% respectively, and electricity and water by 5.3%. The agricultural and fisheries sector rose by 4.65%, driven by the fishing industry which was up 6.61% against agriculture, which rose only 3.20%.

Peruvian presidential candidate, Ollanta Humala, has seen his share of the vote fall 8 percentage points to 18.4% in the most recent opinion polls. Humala, a retired lieutenant colonel, has now slipped behind ex president Alan García who polled 20.8%. Conservative front-runner Lourdes Flores continues to consolidate her lead with 27.2% of the votes. Elections are due to be held on April 9.

One of the leading candidates in Peru’s upcoming April elections, Lourdes Flores, says that she is expecting world-famous Peruvian economist Hernando de Soto to join her administration, should she win. De Soto, considered by many to be the region’s leading economist, is the founder of the think-tank Institute of Liberty and Democracy in Lima and author of ‘El Otro Sendero’ (‘The Other Path’). A recent poll shows conservative candidate Flores with an 8% lead over nearest rival, nationalist Ollanta Humala.

Fernando Zavala Lombardi, Minister of Finance of Peru will address an audience of issuers, investors, and intermediaries at the next Latin American Borrowers and Investors Forum in Miami on February 16th. The forum will bring together the leading institutions and individuals that shape Latin America’s capital markets. They include Jeff Huther, Director of Debt for the U.S. Department of Treasury; Atul Mehta, Head of Latin America & the Caribbean at the IFC; Andreas von Wedemeyer, President of AFP Profuturo and Arthur Steinmetz, Head of International Bond Trading at Oppenheimer Funds Inc.; among others. To learn more please visit www.latinfinance.com/labif