WORLD TRADE  
ORGANIZATION  WT/TPR/M/189 
10 December 2007 
 (07-5485) 
Trade Policy Review Body 
17 and 19 October 2007   
 
 
TRADE POLICY REVIEW 
 
PERU 
 
Minutes of Meeting
 
 
Chairperson:  HE Mr Vesa Himanen 
 
   Page 
 
I.
 INTRODUCTORY REMARKS BY THE CHAIRPERSON 3  
II. OPENING STATEMENT BY THE REPRESENTATIVE OF PERU 4  
III. STATEMENT BY THE DISCUSSANT 8  
IV. STATEMENTS BY MEMBERS 11  
V. REPLIES BY THE REPRESENTATIVE OF PERU AND ADDITIONAL 
COMMENTS 21  
VI. CONCLUDING REMARKS BY THE CHAIRPERSON 25  
 
 
Note:   Advance written questions by WTO Me mbers and the replies provided by Peru are 
reproduced in document WT/TPR/M/189/Ad d.1 and will be available online at 
http://www.wto.org/english/tr atop_e/tpr_e/tp_rep_e.htm. WT/TPR/M/189 
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  I. INTRODUCTORY REMARKS BY THE CHAIRPERSON 
1. The third Trade Policy Review of Peru was held on 17 and 19 October 2007.  The 
Chairperson HE Mr Vesa Himanen (Finland) welcomed  the delegation of Peru, headed by the Vice-
Minister of Foreign Trade and Tourism, Eduar do Ferreyros, and the discussant, Ambassador Bruce 
Gosper (Australia).  As usual, the discussant would speak in his personal capacity and not as a 
representative of his country.  In accordance with th e established procedures, the discussant had made 
available, in advance, outlines of the main i ssues he intended to raise (document WT/TPR/D/164). 
2. The Chairperson recalled the purpose of the Trad e Policy Reviews and the main elements of 
the procedures for the meeting.  The report by Pe ru was contained in document WT/TPR/G/189 and 
that of the WTO Secretariat in WT/TPR/S/189.  As indicated in WT/TPR/6/Rev.1, the Member under 
review should provide written answers, by the be ginning of the review meeting, to questions 
submitted at least two weeks before the meeting.  Questions posed subsequently should be answered, 
to the extent possible, before the start of the second session of the meeting.  Questions left 
unanswered at the end of the second session should be  answered in writing no later than one month 
after the meeting.  Questions by the following de legations had been submitted in writing at least 
two weeks in advance of the meeting and had been transmitted to the delegation of Peru:  Mexico;  
Brazil;  China;  Switzerland;  Canada;  Chile;  the United States;  Chinese Taipei;  Colombia;  
Australia;  the European Communities;   Korea;  Argentina;  and Jap an.  Copies of these questions and 
of the answers provided by the delegation of Peru were available in the meeting room.  Hong Kong, 
China;  and Thailand had submitted written questions  after the two-week deadline.  These had also 
been transmitted to the delegation of Peru;  copi es of these questions and of the answers provided by 
the delegation of Peru were available in the m eeting room.  All advance questions, as well as the 
responses received from the delegation of Peru, are reproduced in WT/TPR/M/189/Add.1. 
3. The Chairperson noted that the liberalization of Peru's trade and investment regime had been 
accompanied by growing trade and investment flows,  as well as a solid economic performance.  Peru 
was seeking to integrate further into the global economy to enjoy the advantages of international 
market specialization.  At the same time, Peru had increased the level of effective assistance to some 
sectors, including through fiscal incentives.  He wondered whether Peru's aim to let comparative 
advantage dictate the terms of its integration into  the world economy would be better served by more 
neutral policies than those adopted during the peri od under review.  He asked where Peru thought its 
comparative advantages lay. WT/TPR/M/189 
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  II. OPENING STATEMENT BY THE REPRESENTATIVE OF PERU 
4. The representative of Peru
 noted that if trade policy was to contribute to a country's 
development, it had to be built on  economic and legal foundations th at afforded stability for economic 
operators.  Peru's trade policy was based on four  pillars:  the Political Constitution, enshrining 
freedom of private initiative in a social market eco nomy.  This provided a sound basis in law which 
had been further strengthened by almost two d ecades of economic stability.  Economic reforms had 
begun in the 1990s and had moved forward under the current Government.  The third pillar was the 
National Agreement, providing space for dialogue be tween the country's political forces and the key 
civil society organizations, which sought to reach  agreement on long-term State policies conducive to 
stability in a sustainable development perspective.  The Agreement had been signed in 2002, and it 
operated under Government leadership.  The buildin g of a solid institutional framework in order to 
promote and ensure compliance with clearly stated rules of the game had led inter alia  to the creation 
of the Ministry of Foreign Trade and Tourism in 2002, as a focal point into which to channel government endeavours and private initiative for trade. 
5. The reforms undertaken in the 1990s had yiel ded positive results, and the Peruvian economy 
had recorded solid growth since Peru's last Revi ew in 2000.  In an upward trend since 2001, GDP had 
grown at an annual rate of 8 per cent by year's end 2006, with a similar increase forecast for 2007.  
The rise in real per capita income averaged of 3.5 per cent per year in the period 2000-2006.  Such 
favourable performance was the result of sound and responsible implemen tation of monetary and 
fiscal policies.  Monetary policy was formulated by the autonomously managed Central Reserve Bank.  Strict rules stipulated that the Ba nk was prohibited from extending guarantees regarding 
national assets or granting credit to particular s ectors.  Prudent monetary management based on 
inflation targets had maintained that variable be low 2.5 per cent since the introduction of inflation 
targets in 2002.  From the fiscal standpoint, sou nd revenue management was attributable to the 
quantitative targets set by the Law on Fiscal Respons ibility and Transparency, which stipulated that 
the annual fiscal deficit in the non financial publ ic sector was not to exceed 1 per cent of GDP.  
Government finances had been consolidated as a result, which, along with concrete measures to 
increase revenue collection, had generated a primary surplus of 2.1 per cent in 2006. 
6. Positive performance of macroeconomic indicator s had been recorded.  There nevertheless 
remained challenges of concern to Peru, such as poverty, which affected 44.5 per cent of the 
population in 2006.  Although a 4.2 percentage point reduction had been registered compared to 2005, 
poverty rates were still very high.  In order to improve the population's living conditions, the 
Government would continue to im plement various social policies ai med at ensuring a better sanitation 
and education infrastructure and broader health ser vices coverage.  Along with those objectives, the 
Government had set targets for 2011 for improving social indicators, which included reducing rural 
poverty by 20 points (from 72 to 52 per cent);  reducing chronic malnutrition among children under 
five in rural areas by at least 10 per cent (39 per cent);  and diminishing by half illiteracy among 
young adults in rural areas (16.3 per cent). 
7. However, economic policies required the appr oval of economic operators.  In 2002 it had 
accordingly been decided to step up dialogue as a dynamic process for policy adoption, thereby 
securing long term policies to ensure continuity in the playing field.  The National Agreement's 
twenty-second policy statement recognized the importa nce of foreign trade for the country's economy.  
The Agreement advocated the search for new and be tter trade agreements in order to increase and 
diversify markets for Peruvian products and services.   It also advocated a dynamic and comprehensive 
trade promotion policy to build up a competitive suppl y of exportable goods with the participation of 
small and medium size enterprises. 
8. The trade policy objective was to help lay the necessary foundations for sustained growth and 
modernization of the Peruvian economy, seeking to improve its efficiency and productivity so as to  WT/TPR/M/189 
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  ensure its competitiveness.  Peru's trade policy of openness and liberalization was also geared towards 
better integration of the country in the global econom y, so as to enjoy the advantages of international 
market specialization.  The aim was to contribute to poverty re duction and improve the wellbeing of 
the population through formal and dignified employ ment that generated adequate income.  Economic 
literature showed evidence of a positive relations hip and causal link between open trade and economic 
growth.  As a result of international experience, it was estimated that a 1 percentage point increase in 
the trade to GDP ratio implied per capita GDP growth of 1.5 to 2 per cent.  Peru used two instruments 
in pursuing its trade policy objective:  internationa l trade negotiations, first of all, as a means of 
generating and consolidating access to international markets, establishing stable and predictable rules 
in trade relations, increasing efficiency and prod uctivity in domestic production and contributing to 
the wellbeing of final consumers.  Trade negotia tions were supplemented by a second instrument 
directed at achieving competitiveness in foreign tr ade by building up an efficient, competitive and 
attractive export supply for international markets.  Both instruments were used with an open-trade 
outlook geared towards efficient production, whic h had begun in 1991 and continued to date.  The 
twofold perspective under which those trade policy instruments were applied had produced export 
growth since 2000, at a nominal average rate  of 23 per cent, from US$7 billion in 2000 to 
US$23,765 million in 2006, while imports had doubled to US$15 billion.  Exports were expected to 
increase to over US$26 billion in 2007.  Such expa nsion was not only attributable to a favourable 
international price environment.  Peru's non- traditional value-added exports had undergone a 
cumulative increase of 141 per cent in the period 2000-2006. 
9. In international trade negotiations, Peru consider ed that the most effective and comprehensive 
system was the multilateral one, which the country  had advocated since 1951 in the GATT and as a 
founding Member of the WTO since 1995.  In its vi ew, however, bilateral a nd regional schemes were 
complementary to the multilateral trading system.  The temporary and conditiona l nature of unilateral 
preferences had changed in favour of bilateral a nd regional schemes as an expeditious and attractive 
complement to the multilateral system.  Peru was part icularly attentive to unilateral openness, since it 
ensured more efficient allocation of resources and consolidated the production base in the light of 
comparative advantages, thus increasing the c ountry's competitiveness.  Nevertheless, trade 
liberalization was a necessary but insufficient prer equisite for achieving a sustained economic growth 
record, and the Government therefore invested considerable efforts in further developing 
infrastructure, and institutional, educati onal, health sector and other reforms. 
10. Peru drove an aggressive negotiating agenda.  In  addition to the agreem ents with the Andean 
Community and those negotiated with MERCOSUR,  Chile and Mexico, there were agreements 
already signed and pending entry into effect, su ch as those with the United States, Singapore and 
Thailand, the extension of the Economic Compleme ntarity Agreement with Chile, the agreements 
under negotiation with Canada and EFTA, the exte nsion of the Complementarity Agreement with 
Mexico, and an Association Agreement with the European Union that Peru was negotiating as a 
member of the Andean bloc.  Peru hoped soon to initiate negotiations with  China, Korea and the 
Central American countries.  It had expressed inter est in entering into free trade agreements with 
various other countries in the future so as to ensu re access under clear and predictable rules for over 
90 per cent of its exports.  Alongside the above, th e Doha Round negotiations were under way, and 
Peru took an active part in the APEC forum.  He affirmed Peru's firm undertaking to host APEC in 
2008 and to pursue the outstanding work done by Australia during 2007.  APEC 2008 and the APEC 
Geneva Caucus would contribute to  the Doha Round negotiations a nd hence to the strengthening of 
the multilateral trading system. 
11. There would be little point in seeking new mark ets through trade negotiations without an 
instrument conducive to the development of producti on capacity with a view to the latter's integration 
in global markets.  Since 2000, Peru had accordi ngly focused on achieving greater competitiveness 
through the development of its Strategic Nationa l Export Plan (PENX), which set out guidelines 
agreed by consensus between the public and the private sector, with  a long-term outlook (2003-2013).  WT/TPR/M/189 
Page 6  
 
  It was a dynamic process that was constantly be ing tailored to the country's evolving production 
sectors. 
12. The PENX focused on the implementation of concrete  activities on five strategic fronts:  first, 
trade facilitation, for which the Trade Facilitation Master Plan had been designed in order to 
streamline customs procedures, mainly through the creation and implementation of a single window;  
second, operational plans inter alia  for the fisheries, forestry, agricu lture, cottage industry, textile, and 
services sectors;  and third, operational market pl ans that sought to identify specific demands in 
international markets on the basis of the comp arative advantages offered by Peru's production 
structure.  Those plans had been given priority under Peru's aggressive trade agenda.  Fourth, the 
PENX being a comprehensive plan of national scope , the development of regional export plans was 
under consideration, with identification of export opportunities in each of the country's 24 regions to 
enable them to take advantage of trade agreements .  Lastly, to ensure achievement of the long term 
goals envisioned, an export culture was being fostered inter alia  through the incorporation of foreign 
trade topics in the educational curriculum.  Both trade policy instruments therefore made valuable 
contributions to the country's development and had led to Peru's favourable economic performance.  
The soundness of Peru's open-trade outlook was eviden ced by the fact that in 2006 total imports and 
exports accounted for 41.4 per cent of GDP, whereas in 2000 the figure had reached only 26.8 per cent.  Likewise, the number of exporting enterp rises had increased by 62 per cent over that same 
period. 
13. The legal framework established in the WTO wa s a fundamental component of Peru's trade 
policy.  Peru had made the necessary adjustments to bring its domestic legislation into line with the 
undertakings deriving from the Agreements.  It w ould continue to take an active part in all 
WTO related areas.  Compliance with and monitoring of the WTO Agreements were key to ensuring 
the predictability and market access conditions needed for Peruvian exports.  In that connection, he 
expressed concern about certain measures adopted by the developed countries, particularly sanitary 
and phytosanitary measures, which had become  barriers to access for a significant group of 
agricultural products of interest to Peru.  He hoped that dialogue in the Committee on Sanitary and 
Phytosanitary Measures would afford proof of its effectiveness by resolving the problem, which 
significantly affected Peru and especially exports from the most depressed rural areas of the country. 
14. Peru reaffirmed its commitment to the Doha  Development Agenda.  The Round had to 
produce ambitious, concrete, balanced and developmen t-oriented outcomes in all negotiating areas.  
Those outcomes had to be achieved through comprehe nsive and transparent negotiations, in which all 
Members, and particularly the major trading partne rs, showed evidence of their commitment to the 
system.  As to the agriculture and NAMA negotiati ons, Peru noted the importance of those two areas 
in ensuring a successful Doha Round.  Full modal ities had to be achieved without delay in both 
negotiating areas.  Peru's commitment had led to its co-sponsoring, together with a large group of 
other countries, of a moderate NAMA proposal, in an attempt to bring positions closer together in the 
search for ambitious modalities satisfactory to all.  In agriculture, Peru accorded particular importance 
to the mandate of full liberalization of tropical and alternative products.  Liberalization of those 
products would allow Peru to achieve better integra tion in the world economy and contribute to a joint 
approach concerning the global drugs issue.  Another matter of priority for Peru was the incorporation 
in the TRIPS Agreement of the obligation to discl ose, as a patentability requi rement, the origin of 
genetic resources and/or traditional knowledge.  That proposal, tabled by Peru jointly with Brazil and 
India and supported by most developing countries, would make for a more balanced intellectual 
property system as the TRIPS Agreement was brought  into line with existing obligations under the 
Convention on Biological Diversity, while contributing to  a fair and equitable distribution of benefits 
derived from inventions using gene tic resources and traditional knowle dge.  Peru therefore remained 
committed to firmly moving that work forward in the WTO in order to achieve the concrete results so 
long awaited by its indigenous pe oples and native communities.  The negotiations on rules were also 
important to Peru.  At the outcome of that nego tiating process, there should be stronger disciplines for  WT/TPR/M/189 
 Page 7 
 
 
  fisheries subsidies, prohibiting those that led to  overcapacity and overfishing, while taking into 
account special and differential treatment. 
15. Liberalization of services, especially in Mode 4, was of the utmost importance.  In its initial 
and improved offers, Peru had opted for the fullest liberalization and hoped th at its position would be 
reciprocated by all Members and especially those that  maintained restrictions in Mode 4, one of the 
modes of supply in which Peru was highly compe titive, with potential that was frequently under 
exploited on account of such restrictions.  Anot her area in which Peru had submitted proposals was 
trade facilitation – a sector critical to the delivery of concrete outcomes in the other negotiating areas, 
through the creation of an efficient transport system and modern and transparent customs services.  The WTO Aid for Trade initiative was vital if open trade was to contribute to growth for all the 
developing countries.  Peru had hosted the first hi gh-level Latin American regional dialogue meeting 
in September 2007.  The results achieved would be helpful for the November 2007 meeting.  The 
WTO Director-General had provided the impetus fo r the important Aid for Trade initiative, and his 
presence at the September meeting in Lima had been an honour for Peru. 
16. Peru would pursue its economic policy objectives of sustained growth of GDP and social 
inclusion, consolidation of its integr ation in external markets, and infl ation control, in order to further 
its progress in the economic and social spheres.  Peru  was just one step away  from investment grade, 
which, along with its strategic geographical location, would make it an ideal base for business in the 
region, under a free-trade regime that  included free movement of capital.  It would therefore continue 
to increase its participation in all the trade bodi es to which it belonged.  Peru was faced with 
challenges that could not be ignored, but those ch allenges would be overcome thanks to the rigorous 
policies the country had set itself. WT/TPR/M/189 
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  III. STATEMENT BY THE DISCUSSANT 
17. The discussant (HE Mr Bruce Gosper) noted that Peru was a member of APEC and would 
host APEC in 2008, taking over from Australia.  Peru had done commendably in meeting the APEC 
commitment to open trade and economic growth and was well placed to take a leadership role in 
2008.  Peru was blessed with abundant mineral res ources;  a substantial proportion of Peru's export 
and government revenues were derived from this.  Peru had benefited from the high commodity prices 
of recent years, and needed a policy to take adva ntage of strong commodity prices to create the basis 
for economic growth that could be sustained throughout the commodity cycle. 
Economic environment 
18. Peru's economic performance over the review  period had been solid, with real GDP 
increasing at an annual average rate of 4.8 per cent.   Importantly, the rate of growth had accelerated, 
reaching 8 per cent in 2006.  This strong perfo rmance had been underpinned by prudent economic 
management and structural reforms, including the li beralization of the trade regime.  An important 
contribution had been made by the favourable ex ternal environment, including the rise in global 
commodity prices.  Peru's Finance Ministry had fo recast growth of 7 per cent in 2007, and well above 
5 per cent in the following few years.  Peru's mone tary policy had been conducted within an inflation 
targeting framework, and fiscal policy was implemente d with reference to quantitative targets set by 
law.  In this context, inflation had been low, the fiscal position had impr oved, and public debt had 
fallen.  Nevertheless, Peru faced challenges in  translating these achievements into strong and 
sustained improvements in social indicators.  Form al unemployment remained sizeable, with most of 
the labour force engaged in the informal sector.  The proportion of the population living in poverty 
had fallen but remained high, at around 45 per cent,  with extreme poverty at 16 per cent.  Continued 
economic growth would boost formal employment a nd increasingly feed through to faster reductions 
in poverty levels.  One driver for this might be the continued increase in non-traditional exports.  This 
suggested the need to continue to reform and im prove the productivity of other sectors, including 
through improvements in infrastruct ure and the business environment. 
19. The contribution of trade to GDP had increased from 27 per cent in 2000 to 41 per cent in 
2006;  exports of goods and services had expanded at a real annual rate of over 8 per cent and imports 
at 7 per cent.  This had been accompanied by chang es in both the composition and direction of trade:  
the share of minerals in total exports had risen markedly, particularly since 2003, reflecting higher 
commodity prices and export volume, underpinned by strong levels of private investment. 
Trade policies 
20. Peru pursued an active trade policy at the multilate ral, regional, and bila teral levels.  In the 
Doha negotiations, Peru had made proposals across various areas, including agriculture, rules, 
services, and intellectual property.  Peru became  a member of the Cairns Group in 2006, and 
participated in the G20 and G33.  It became a me mber of APEC in 1998.  Its role as host ten years 
later underlined its growing trade links with th e Asia-Pacific region and provided an occasion to 
showcase commercial opportunities.  Speaking at the APEC 2007 Business Summit President Garcia 
outlined Peru's vision for APEC 2008 as "growth, equi ty and sustainable development."  It would be 
interesting to hear more from Peru on its particular  objectives for its APEC host year, bearing in mind 
the expansion of APEC's agenda in recent years, as demonstrated, for example by the APEC Leader's 
Declaration on Climate Change, Energy Security and Clean Development.  Peru granted duty-free 
treatment to Andean Community members and prefer ences of varying scope to a number of other 
partners.  Peru had signed FTAs with Chile and wi th the United States, while negotiations were in 
progress with Singapore, Mexico, EFTA, Canada, a nd the EC.  It was undertaking a joint FTA 
feasibility study with China.  He was interested in learning about the principles guiding Peru's extensive FTA agenda, and whether FTA liberalizati on would facilitate further MFN liberalization.   WT/TPR/M/189 
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  He asked how Peru would ensure that the focus on  reciprocity inherent in negotiating FTAs did not 
undermine its programme of autonomous liberalization. 
21. Peru's solid economic performance in recent y ears had been underpinned by a process of 
liberalization and modernization of its trade regime .  Peru had reduced its average applied MFN tariff 
rate, from 13.6 per cent in 1999 to 8.2 per cent in April 2007.  The current maximum applied tariff 
was 20 per cent, although many agriculture lines were subject to a surcharge or variable levy.  Peru 
had bound its entire tariff schedule in the Uruguay Round in ad valorem  terms, mostly at 30 per cent, 
with the exception of just 29 agriculture tariff lines bound at 68 per cent.  Unilateral tariff liberalization put Peru in a comfortable position to implement any outcome of the Doha negotiations.  
In mid-2005, Peru had eliminated export require ments for granting benefits under two free zone 
programmes.  However, it mainta ined a "simplified" duty drawback  scheme for exporters without any 
mechanism to ensure that the amount given back did not exceed the actual duties paid.  He asked 
about Peru's plans to remedy this.  Peru conti nued to maintain a number of incentive programmes to 
promote business activity and investment, many in the form of fiscal exemptions.  He asked for more 
information on the framework established in early 2007 to regul ate fiscal incentives. 
22. Competition policy, intellectual property protec tion, technical standards development, and 
trade remedies were the responsibility of the Nationa l Institute for the Defence of Competition and the 
Protection of Intellectual Property (INDECOPI).  This was an interesti ng model, and he sought 
additional information about INDECOPI's object ives, including whether its competition remit 
extended to the evaluation of government polici es and their impact on competitiveness.  Given the 
potential synergies this arrangement created across different areas, it was important to build up the 
institutional strength of INDECOPI.  Therefore, it was surprising that INDECOPI funded most of its 
work through fees and fines.  While a cost recove ry model might be appropriate for some areas of 
INDECOPI's work, its application to the area of  competition policy and any scrutiny of government 
policies seemed questionable.  Regarding government  procurement, Peruvian legislation granted a 
20 per cent preference margin to bidders who used domestic goods.  While this might have benefits in 
promoting domestic production, it would seem to sh ield local suppliers from international competition 
and must result in higher costs for taxpayers. 
Sectoral policies 
23. Peru had cut its average tariff protection on ma nufactured products to 7.2 per cent, down from 
13 per cent in 1999.  This reduction had been ac companied by a significant increase in labour 
productivity.  GDP growth for the sector had exceeded  the average for the economy as a whole, while 
exports had also increased.  However, Peru's un ilateral liberalization measures had moved it away 
from its previous largely uniform tariff structure, increasing the level of effective tariff protection to 
some sectors.  Selective assistance was also granted through several fiscal incentives.  In this context, 
he asked about Peru's plans to address remaining hi gh sectoral tariffs, and whether sectoral assistance 
schemes were linked to plans for future reform of those sectors. 
24. Regarding agriculture, this sector still employed  some 37 per cent of the economically active 
population.  The value of agricultural production and exports had been increasing, albeit at a lower 
rate than the economy as a whole, and Peru w as now a net exporter of agricultural products.  
However, average tariff protection in agriculture was twice as high as in other sectors.  While the 
highest basic tariff was 20 per cent, 392 agricultural tariff lines were subject to a tariff surcharge of 
5 per cent, and a further 46 lines subject to reducti ons or surcharges linked to variations in world 
prices.  This seemed to raise questions in the light  of recent WTO jurisprudence.  Peru might care to 
review this arrangement.  Peru  had various programmes for agricultural producers, including some 
that favoured domestic inputs.  Lega l limits applied to the use of im ported inputs for the production of 
liquid milk and derived products.  Peru had indicated  that these were not applied in practice, and he 
asked whether Peru intended to remove them from th e statute books.  He sought information on the WT/TPR/M/189 
Page 10  
 
  extent to which support programmes were establis hed with a view to facilitating reform and 
increasing productivity.  While its relative importance had declined, the fisheries sector accounted for 
about 7 per cent of total exports in 2006.  Peru ha d historically been active in the campaign against 
fisheries subsidies, and had continue d this advocacy through the Doha Round. 
25. Mining and hydrocarbons had made the greatest c ontribution to Peru's export growth in recent 
years.  Mining output had increased significantly, reflecting a sharp rise in private investment.  
Between 2000 and 2006, the share of  minerals and non-ferrous metals  in total exports had increased 
from 46 per cent to 62 per cent, with copper and gold contributing some two thirds.  Peru was also the 
largest global producer of silver, and a leading gl obal producer of tin, zinc, lead, and molybdenum.  
Exports of hydrocarbons were also set to increase, particularly with the development of natural gas 
reserves.  Following recent oil and gas discoveries, and with continued private investment, Peru was 
expected to become a net hydrocarbon exporting coun try by the end of the decade.  While the mining 
sector accounted for some 1 per cent of employme nt, it was a substantial contributor to public 
revenues and to local and regional development.  In  mid 2004, Peru had introduced royalties on sales 
by mining companies, and since end 2006 it had encouraged mining firms to make contributions of 
3.75 per cent of profits for social and infrastructure projects.  In order to fulfil this sector's potential 
and continue to attract the necessary investment Peru  had to maintain a stable regulatory environment, 
balanced approaches to revenue sharing, and sound social and environmental practices to ensure the 
support of the community. 
26. In the services sector, Peru had also been c ontinuing a process of reform since the 1990s.  
This process needed to continue , given the sector's importance fo r supporting development across the 
broader economy.  Peru maintained several MFN re servations under the GATS, and some reciprocity 
requirements or other limitations on foreign participa tion in particular subsectors, including maritime 
transport and broadcasting.  Nevertheless, the services sector appeared quite open to foreign 
participation.  In telecommunicati ons, the legal framework had been lib eralized to facilitate the entry 
of new operators.  Professional services appeared to be highly regulated, although not closed to 
foreign entrants.  He asked about initiatives to ease foreign entry, including through Peru's bilateral 
agreements with 25 countries for recognition of qualifi cations.  He sought information on the extent to 
which this had facilitated entry, pa rticularly given that professionals needed to obtain membership of 
the relevant professional association. 
27. Peru still faced significant challenges, but the current favourable economic environment 
presented an opportunity to meet these, including by injecting greater competition into the domestic 
market, undertaking further reforms, and addr essing remaining bottlenecks in the economy, in 
particular those arising from poor infrastructure.   While the increase in commodity prices had fed 
through to tax revenues, a further challenge was to improve the revenue base so as to safeguard 
against any future downturn in commodity prices.   Continued strong economic growth and further 
reforms would increasingly translate into more rapid improvements in social parameters, particularly 
to an accelerating reduction in poverty levels.  WT/TPR/M/189 
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  IV. STATEMENTS BY MEMBERS 
28. The representative of Mexico  noted that Peru's fiscal discipline and sound monetary policy 
management had been complemented by an outward -looking approach.  Growth had averaged 4.8 per 
cent over the previous six years, and in 2006 real growth had reached 8 per cent.  Nevertheless, a 
sizeable proportion of the population still lived in pove rty (45 per cent).  To remedy that situation, it 
was essential to deepen the reforms aimed at deve loping infrastructure, simplifying the regulatory 
framework, and remedying deficiencies in the pub lic security and justice administration system.  
Regarding trade, Peru had sought to complement trade liberalization policies with an increase in 
export supply, through regional and sectoral plans.  However, the country's fiscal incentives programmes should be reviewed in order to streamlin e those that did not provide a net benefit to the 
economy.  A complex incentives system made tax admi nistration more difficult, increased the risk of 
State finance problems and was a source of economic  inefficiency.  Although average applied tariffs 
had been reduced from 13.6 per cent in 1999 to 8. 2 per cent in 2007, the tariff structure had lost 
uniformity and provided higher effective protection in some sectors.  There was a significant gap 
between applied tariffs and tariffs bound in the WTO (22 points on average).  Concerning investment, 
it was most important to pursue the internal analysis of conditions conducive to greater 
competitiveness inside the Peruvian economy, includ ing a performance evaluation of some 50 partly 
State-owned firms.  As to foreign participation, ther e were sectoral laws restricting foreign investment 
in sectors such as maritime and air transport, and br oadcasting.  He asked whether any legislation was 
planned in order to increase foreign participation in  those sectors.  An evaluation should be made of 
the costs and benefits of maintaining existing policies. 
29. During the period under review, Peru's exports  to Mexico had accounted for an annual 
average below 2 per cent of the annual total – a mod est figure compared to the existing potential.  The 
same could be said of Peru's imports from Mexico , which had averaged a little over 3 per cent of the 
annual total in the period 2000-2006.  Bilateral tr ade links should be strengthened and advantage 
taken of the close historical and cultural ties betw een the two nations.  The WTO negotiations and the 
ongoing negotiation of a more extens ive Partial Scope Agreement were  two appropriate instruments 
to that end.  Concerning the trade strategy geared towards Peru's integration in global markets, the 
country's unilateral, bilateral a nd multilateral trade liberalization initiatives were complementary.  In 
order to help strengthen the multilateral trading syst em, Peru should continue taking an active part in 
the Doha Round negotiations and put  forward better undertakings concerning market access for goods 
and services. 
30. The representative of Brazil
 commended Peru for the sustainable growth course it had steered 
since 2000, with an average annual rate of 5.8 per cent in the period 2002-2006.  The trend was 
expected to continue over the coming six years.  Peru's favourable economic circumstances were attributable to the implementation of development policies consistent with the aims of achieving 
greater competitiveness, stimulating investment in in frastructure, opening up to international trade, 
and increasing exports.  Private investment amounted to over US$20 billion (20 per cent of GDP).  As 
regards the balance of payments, a positive figure of US$708 million had been recorded and the trade 
balance had shown a surplus of US$8,934 million in 2006.  Peru had made e fforts to improve its 
institutions and guarantee legal certainty.  Fiscal poli cy and inflation control had played a key role in 
the process, with a fiscal surplus of 0.6 per cent of GDP in 2006 and an inflation rate of 1.4 per cent 
for that same year.  Those favourable economic circ umstances had led to more foreign investment and 
trade, including with Brazil. 
31. Brazil's direct investment in Peru had increased  significantly over the previous three years.  
Many Brazilian enterprises had set up activities in Peru  in sectors that included infrastructure, mining, 
the food industry, and consumer goods.  The cu mulative stock of investment had risen from 
US$425 million in 2001 to US$1.5 billion in 2004.  The flow of bilateral trade had reached 
US$2.3 billion in 2006, exceeding the figure for 20 05 by 64.4 per cent.  Brazil ranked third among WT/TPR/M/189 
Page 12  
 
  Peru's principal trading partners.  Brazilian expor ts to Peru had grown steadily since 2004, reaching 
US$1.5 billion.  In 2006, Brazil had been the sec ond largest source of Peruvian imports.  Peruvian 
exports to Brazil had also undergone steady expa nsion, reaching US$788.2 million in 2006, with a 
71.7 per cent increase over 2005.  Peru played an activ e role in a number of integration processes in 
the region, including the Latin American Integration Association.  It was also a full member of the 
Andean Community and an associate state of MERCOSUR.  The multilateral trading system was 
critical to poverty reduction, meaning that the WT O had to be strengthened as a rules-based system 
capable of making a significant contribution to deve lopment.  Brazil and Peru both sought ambitious 
and balanced outcomes in all th e Doha Round negotiating areas. 
32. The representative of China
 welcomed Peru's solid economic performance since 2000, with 
annual GDP increases of 4.8 per cent, and export and import expansion by 8.3 per cent and 7 per cent.  
This had been accompanied by continued ma croeconomic reform and liberalization and 
modernization of Peru's trade regime.  Peru faced  challenges in its economic development.  Further 
improvements in the economic environment would he lp it sustain the positive momentum for growth 
and provide a sound basis to further spread the bene fits of development and reduce poverty.  In recent 
years, economic and trade cooperation between China and Peru had expanded c ontinuously.  Bilateral 
trade had increased by 36 per cent in 2006, reaching US$4 billion.  China was Peru's second most important trading partner, and Peru was China's sixth most important trading partner in Latin 
America.  China's FDI in Peru reached US$600 million at end 2006.  The recent FTA negotiations between the two countries would enhance bilate ral trade and economic relations.  Peru was 
commended for its contribution to the Doha nego tiations and its strong support for the Round's 
development dimension. 
33. The representative of Switzerland
 noted that bilateral trade had recently increased 
significantly, reflecting the dynamism of the Peruvian economy.  During the past two years, Swiss exports to Peru had grown by 32 per cent, and imports  by 46 per cent.  This trend had been confirmed 
during the first nine months of 2007.  Switzerland w as Peru's third most important export destination, 
and it was the fifth largest foreign investor in Peru .  Swiss firms employed more than 5,000 people in 
Peru and benefited from the provisions of a Bila teral Investment Treaty;  an FTA was being 
negotiated under the EFTA framework.  Under its  Economic Development Cooperation with Peru, 
Switzerland supported the diversification of Peru's exports.  Trade cooperation included strengthening 
Peru's negotiation capacities, developing exporta ble products from local biological resources, 
managing regional tourism destin ations, and developing cleaner production.  In 2006, Swiss 
cooperation with Peru, including Swiss Develo pment Agency programme, totalled SFr16 million. 
34. Since its previous Review in 2000, Peru had achieved robust GDP growth rates.  Switzerland 
commended Peru for its rigorous macroeconomic po licy, which had led to the first non-financial 
public sector fiscal surplus in 2006 and low inflation.   The exchange rate had appreciated steadily 
against the US dollar, reflecting sound economic management and a strong external position.  A 
favourable climate for foreign investors and high commodity prices had supported this performance.  
Future strong growth would be of utmost impo rtance to continue to reduce poverty, generate 
employment, and diversify the economy further.  Pa rticular attention would have to be devoted to 
infrastructure, education, public security, judicial administration, and business-related procedures.  He 
noted Peru's increased integration in the world econo my, as reflected in the substantial growth of the 
share of merchandise trade to GDP, from 27 per cent in 2000 to 41 per cent in 2006.  There had also 
been a significant shift in the origin of imports, with declines in the rela tive shares of the United 
States, the European Communities, and Japan, and gains for China, Brazil, and Ecuador.  Peru had 
carried out significant unilateral tariff reductions  on manufactured products, and trade facilitation 
measures to shorten customs clearance times.  In tegration into the world economy had increased the 
level of domestic competition a nd hence labour productivity.  Ho wever, complementary measures, 
such as building up the institutional capacity of th e INDECOPI were needed to strengthen Peru's 
economic performance.  He invited Peru to join the GPA in order to intensify domestic competition  WT/TPR/M/189 
 Page 13 
 
 
  and benefit from improved market access opportunities abroad.  Ther e had been a significant increase 
in the number of anti-dumping investigations durin g the period under review;  these measures had to 
be duly justified and documented and should not be used for protectionist purposes.  Switzerland 
shared with Peru a strong interest in the successful conclusion of the Doha nego tiations.  As one of the 
macroeconomically most stable economies in Latin Am erica, Peru was in an outstanding position to 
remain an attractive country for foreign investors, to benefit from world and domestic growth, and to 
make further progress toward the Millennium Development Goals. 
35. The representative of Canada  noted that relations with Peru were strong and growing.  Peru 
was an important partner for Canada in the pr omotion of human rights, democratic governance, 
corporate social responsibility, and free trade.  The bilateral relationship was reinforced by 
cooperation in fora such as the Organization of American States, APEC, the United Nations, the IMF, 
and the WTO.  In 2006, bilatera l merchandise trade amounted to US$2.1 billion, up 688 per cent since 
2000.  The key sectors of Canada's services trade with  Peru included oil and gas, mining, engineering, 
architectural and environmental services, and in formation technology.  The stock of Canadian 
investment in Peru amounted to US$2.5 billion at th e end of 2006.  Canada and Peru believed in the 
importance of a transparent, stable, and predictable rules-based international trading system.  Canada 
commended Peru for its commitment to transparen cy, including the mechanisms and practices to 
ensure that interested parties were made aware of proposed technical regulations and conformity 
assessment procedures, and were given sufficient ti me to comment on and adjust to them.  Canada 
welcomed Peru's commitment to trade liberalizati on, as exemplified by its unilateral reduction of 
tariffs on agriculture and Peru's br oad coverage of agricultural products  in its FTAs.  In this light, 
Canada was committed to negotiati ng and concluding talks towards a high quality FTA with Peru. 
36. The representative of Chile  noted that the Peruvian economy had favourably evolved since 
2000 and was among the South American economies th at had experienced the highest growth over 
that period.  Inflation was low, and major priv atization projects and regulatory reforms had been 
carried out.  Peru's economic growth was partly  attributable to domestic demand and the export 
sector, which had proved more dynamic than the count ry's other economic sectors, with an almost 
twofold increase in annual average rates over the rest of the economy.  The share of foreign trade in 
GDP exceeded 40 per cent, contrasting with the 25 pe r cent recorded at the turn  of the century.  Trade 
with Chile had totalled US$2.3 billion in 2006, up more than 300 per cent since 2000.  Chile ranked 
as the fifth largest destination of Peruvian exports and the sixth largest origin of Peruvian imports.  
Trade with Peru accounted for 2.5 per cent of Chile's  trade.  Generally speaking, trade between the 
two countries was balanced and cons isted of mining, petroleum, chemical and fisheries products.  
Chilean investment in Peru amounted to US$5.2 billi on, i.e. 14 per cent of Chile's foreign direct 
investment.  Chile was the third largest foreign inv estor in Peru.  More than 250 Chilean enterprises 
were located in Peru, operating in sectors such as electricity, gas, manufacturing, food products, retail 
trade, construction and information tec hnology, and providing various services. 
37. Peru's trade strategy was based on a three-pr onged approach, starting with broad unilateral 
openness of the economy.  Tariff rates were relatively low as a result of gradual unilateral cuts, with 85 per cent of tariff lines ranging between zero and 12 per cent.  On the other hand, the process had 
had the negative effects of eroding equal tariff treatment and widening the gap between agricultural 
and industrial tariffs.  Peru had also simplified its cu stoms procedures.  It main tained fiscal incentives 
to promote certain economic activities and foster inv estment, however, some of which were subject to 
use of Peruvian inputs.  Peru made extensive use of anti-dumping measures.  As at the end of 
June 2007, there were 33 anti-dumping measures in eff ect, three of which affected Chilean products.  
Secondly, Peru pursued an active policy of bilate ral and regional arrangements.  The Free Trade 
Agreement with Chile, which suppl emented and extended ACE No. 38, signed in 1998, had reached 
the stage of legislative approval by the Chilean Congress.  The Agreement included different areas 
such as investment, cross-border trade in services, and origin and trade defence requirements.   
Eighty-five per cent of the bilateral tariff receive d 100 per cent tariff preference.  The Agreement also WT/TPR/M/189 
Page 14  
 
  contained an evolutionary clause, under which it w ould be possible to negotiate financial services, 
government procurement, tourism, mutual recogniti on of titles, free zone treatment and the adoption 
of biodiversity protection measures.  The agreem ent with the United States would boost Peruvian 
trade with its principal trading partner.  Thirdly,  Peru was an active player on the multilateral scene, 
which reflected the importance it attached to a disci plines  and rules based system.  Chile and Peru 
had a shared interest inter alia  in agriculture, NAMA and fisheries s ubsidies.  Peru took an active part 
in APEC. 
38. The representative of the United States
 stated that the economic reforms at the time of Peru's 
last Review had resulted in growing GDP, trade, and investment.  Nevertheless, these reforms had 
only been sufficient to bring real GDP per capita back  to its relatively modest level of the mid 1960s.  
To achieve further improvements in the quality of life of the Peruvian people and to secure the 
flexibility necessary to withstand an d ride out future external shoc ks, Members had encouraged Peru 
to press on with its domestic reform process.  Since then, much of Peru's economic progress could be seen in relation to its trade and investment po licies.  He commended Peru for embracing outward-
looking, proactive trade and investment policies, both bilaterally and multila terally, to help drive 
domestic reforms, economic growth, and job crea tion.  Leveraging these initiatives while benefiting 
from favourable commodity prices had enabled Peru to  reduce by over 10 per cent the portion of the 
population living below the poverty.  Peru still had a distance to travel to lift the remaining 45 per cent of the population out of poverty and life in the informal economy.  But, overall, Peru seemed clearly to be headed in the right direction.  It  had identified trade as a tool to expand the formal 
economy, to draw isolated regions into the economi c mainstream, and to recover from the devastation 
of the recent earthquake in the Pisco region. 
39. Peru had been an engaged and constructive participant in WTO fora.  It had made a number 
of proposals in the Doha Development Round.  The Un ited States appreciated Pe ru's leadership in the 
area of fisheries subsidies, which played a key role in the Doha mandate to address subsidies 
contributing to overcapacity and overfishing.  Peru  was encouraged to reinvigorate its efforts, 
commensurate with its role as a leading developing c ountry producer of fish and fish products.  Peru 
had begun acceding to the Information Technology Agreement, had participated actively in the services negotiations, and ha d engaged, in various capacities, in the dispute settlement process.  While 
it had submitted numerous WTO notifications, othe rs were pending, incl uding its subsidies 
notification.  Peru had bound all its  tariffs and had reduced its app lied tariffs;  the gap between the 
two should be reduced.  Peru had made improveme nts in trade facilitation, but even though Peru 
ranked near the top in the region for ease of doing business, the number of days it took to import 
goods into Peru was above the regional average.  Peru  should take further steps to ease this difficulty.  
Peru maintained an open and stable investment regi me:  its investment policies helped account for the 
impressive 20 per cent increase in private investment  in 2006.  Nonetheless, in order to take full 
advantage of its trade and investment initiatives, Peru should continue to address weaknesses in its 
infrastructure.  The United States had conclude d a comprehensive FTA with Peru, which would 
deepen an already robust trade relationship.  Peru 's single largest trading relationship was with the 
United States.  Bilateral trade had doubled to near ly US$8.8 billion in the three years to 2006, with 
US goods exports to Peru reaching nearly US $2.9 billion and imports from Peru totalling 
US$5.9 billion, an increase of nearly 15 per cent from 2005.  The FTA was currently pending approval by the US Congress.  The agreement c overed trade in goods and services, intellectual 
property rights, investment, government procurem ent, labour, and environment.  A number of the 
reforms Peru would undertake to implement the FTA would also benefit other trading partners.  They 
included measures to improve transparency and effici ency, for example in customs procedures.  Peru's 
trade agenda was ambitious:  in addition to its pa rticipation in the Doha Development Round and its 
FTA with the United States, it had reached and w as pursuing additional trade agreements with a 
number of countries.  Perhaps as a signal of Peru's more prominent international role, it would be the 
2008 host to APEC.  WT/TPR/M/189 
 Page 15 
 
 
  40. The representative of Chinese Taipei  was very impressed with Peru's recent economic and 
foreign trade performance.  The economy had grow n by 8 per cent in 2006, the highest rate in 
11 years.  He congratulated Peru on its fiscal and current account surpluses, and the increase in 
exports during the previous three years, with annua l growth exceeding 35 per cent.  Peru's trade policy 
sought to liberalize trade with a view to further in tegration into the global economy.  Peru had been 
active on the bilateral, regional, and multilateral trad e fronts.  It was the only member of the Andean 
Community that was also a member of APEC.  Peru  would be hosting APEC in  2008.  Chinese Taipei 
was concerned about a few aspects of  Peru's trade policies, including certain anti-dumping practices.  
It sought to extend bilateral trade cooperation. 
41. The representative of Colombia  noted the excellent performance of the Peruvian economy 
since 2000, reflecting the boom in international mi nerals prices and sound economic policies.  In 
2006, the Peruvian economy had grown by almost 8 per cent in real terms, with an inflation rate of 
less than 2 per cent.  Between October 2002 and Oc tober 2007, the Peruvian stock exchange had 
recorded the highest growth in  the world, averaging 87.5 per cent annually in US dollars.  
International credit rating agencies had upgraded th e country's debt risk rating, and Peru would 
shortly be granted investment grade status.  Such  indicators bore witness to investors' confidence in 
Peru.  The country's economic boom was a favourable opportunity to introduce measures aimed at distributing the benefits of economic growth across the population.  Poverty was not diminishing as much as had been expected, affecting around 44.5 per cent of the population.  The share of exports in 
GDP had increased from 26.8 per cent in 2002 to 41 .4 per cent in 2006.  Although such behaviour 
partly reflected the rise in international minerals prices, the value of agricultural exports had also 
tripled between 2002 and 2006.  Over the past 15 years,  Peru had added more than 400 export crops to 
its traditional crops (coffee, cotton and sugar).  It was now specializing in tropical plants and fruit, 
harvested along its arid coast, which showed th at countries need not be hampered by their 
geographical location.  Peru was a member of the Cairns Group. 
42. The trade policies of Peru and Colombia had been formulated side by side.  Peru, like 
Colombia, was a founding member of the Andean Community.  Colombia and Peru had negotiated 
free trade agreements with MERCOSUR and the United States, and were currently negotiating 
arrangements with EFTA, Canada and the European Uni on.  The value of bilateral trade was up to an 
annual average of US$250 million.  Bilateral investme nt flows were also on the rise.  Peru saw free 
trade as a development instrument.  It had reduced its simple average tariff from 11.9 per cent to 8.2 per cent in order to promote competitiveness and streamline the allocation of resources.  It had 
also completed the autonomous liberalization of its trade in services.  Peru exported tourism services 
and travel related services.  In addition to the attr action presented by the ruins of its Inca civilization, 
Peru had been developing a market for food products .  It had played a major role in the Doha Round 
by putting forward concrete negotiating proposals,  several of which had been co-sponsored by 
Colombia.  Peru was seeking to ensure the prot ection of biogenetic resources and the associated 
traditional knowledge of its native populations.  Every effort should be made to preserve the Inca 
civilization.  Not all of it was vestiges:  the Quec hua language, for example, was still very much alive. 
43. The representative of Australia
 noted that his country's commercial ties with Peru had 
continued to grow.  In 2006-2007,  bilateral merchandise trade was approximately AU$226 million.  
Australia and Peru shared an interest in mining investment, services, and equipment.  On 10 September 2007, Australia and Peru had signed a landmark mining and energy pact whereby they 
had agreed to work together towards sustaina ble development in the mining and energy sectors 
through improved environmental pr otection and increased technology and knowledge transfer.  The 
bilateral relationship was also underpinned by cooperation in a num ber of regional and multilateral 
fora.  As members of the WTO and APEC, both countries worked closely to promote greater global trade liberalization and enhanced global and regiona l integration.  Peru had become a Cairns Group 
member in April 2007.  He congratulated Peru for its sustained economic growth, which was the 
result of sound economic management.  Peru's ope n investment regime and abundance of natural WT/TPR/M/189 
Page 16  
 
  resources had made it an attractive investment destination for Australian companies, particularly in 
the mining sector.  Australia encouraged Peru to pur sue additional reforms to sustain current rates of 
economic growth and a more even distribution of the be nefits of liberalization.  Peru had continued to 
make efforts to liberalize its trading regime since 2000.   Absolute levels of pr otection had remained in 
some sectors, notwithstanding the general decrease in tariffs.  Peru applied a 20 per cent tariff on most 
dairy products, together with a 5 pe r cent surcharge, unchanged since 2000. 
44. The representative of the European Communities
 commended Peru for its progress in trade 
liberalization since its last Review.  This had resu lted in an expansion of trade and investment, and 
had been flanked by sound macroeconomic mana gement and the implementation of structural 
reforms.  Moreover, it had been conducive to  a sound economic performance during the period.  
Nonetheless, Peru's economic progress had not been accompanied by an increase in employment rates 
or a reduction in poverty;  these remained major challenges.  Unemployment was high, and most of the labour force was engaged in the informal sect or, which represented around 60 per cent of GDP.  
Productivity in manufacturing had decreased, which ma y have led to job losses in labour-intensive 
industries.  Peru should endeavour to increase productivity to trigger economic growth, thereby 
ensuring sustainable development.  High productivit y and high social standards could be mutually 
reinforcing.  Widespread poverty was another co ncern.  In spite of progress, the poverty level 
remained at around 45 per cent.  Improving the situa tion had to remain a top priority.  Trade policy 
had an important role in this regard.  She ask ed how trade policy was linked to Peru's poverty 
reduction strategy. 
45. Bilateral trade relations were strong.  The EC was Peru's second largest trading partner and a 
major investor:  Peru's exports to the EC totalle d around €3.6 billion in 2006, about 20 per cent of 
Peru's total exports.  The EC was seeking to re inforce political and economic ties through negotiations 
for a comprehensive Association Agreement with the Andean Community, which comprised political 
dialogue, cooperation, and trade.  It was instrumental for the economic prosperity of the region to continue making progress toward the consolidation of the Andean Community.  Peru had committed 
to strengthening its regional polici es and regulations.  She encouraged Peru to apply the Andean 
Community's common external tariff, and to lead  the region in further harmonization of national 
legislation to ease the flow of intra-regional trade.   The strengthening of the integration process 
needed to be transparent and expeditious.  Th is would favour the Andean Community's ongoing trade 
negotiations with other WTO Members, including th e EC.  There was also a need to guarantee full 
transparency in Peru's regional and bilateral age nda.  The FTAs and partial scope arrangements it had 
signed had not been notified to WTO.  Technical a ssistance was needed to develop Peru's trading 
capacities:  the EC was providing trade-related assistance through a cooperation project worth 
€10 million, which included capacity building to im plement the National Strategic Export Plan and 
strengthen the knowledge of Peruvian  authorities on EC trade policy.  She encouraged Peru to pursue 
further liberalization of services trade and to join the GPA. 
46. The representative of Korea
 noted that bilateral trade with Peru had reached more than 
US$1 billion in 2006.  Bilateral trade and investme nt would expand further through the conclusion of 
the FTA they were pursuing.  She welcomed Peru 's solid economic performance in recent years, 
which was the result of prudent macroeconomic ma nagement and the implementation of sustained 
structural reforms.  However, the lack of ad equate infrastructure, excessive regulations, and 
shortcomings in public security and the justice sy stem continued to pose significant challenges for 
Peru's long-term sustainable economic growth.  Theref ore, it was necessary to continue with structural 
reform and trade liberalization, taking advantage of the current favourable external environment.  
Korea appreciated several trade facilitation measures adopted by Peru.  However, Korean exporters 
faced time-consuming and complex customs cleara nce procedures.  Korea encouraged Peru to 
streamline its customs clearance procedures, and asked whether it had any plans to accede to the 
GPA.  WT/TPR/M/189 
 Page 17 
 
 
  47. The representative of Argentina  noted that the continuing growth of the Peruvian economy in 
recent years was attributable to a responsible ec onomic programme.  Peru had established a stable 
legal framework conducive to priv ate investment.  In conjunction with favourable macroeconomic 
indicators, such a framework would attract the fina ncial and technological resources needed to exploit 
Peru's vast natural resources and expand produc tion potential, especially in sectors such as 
agroindustry, mining, and the textile industry.  Peru 's efforts to integrate sectors lying outside the 
market would foster harmonious social development that would in turn contribute to reducing poverty 
levels.  Export growth had played an important ro le in improving the macroeconomic indicators.  The 
export sector would be boosted by a successful outco me to the Doha Round, and Peru was committed 
to that goal.  It had made a number of contributi ons in areas such as fisheri es subsidies, development 
and the environment, and agriculture.  There were  close bilateral ties between the two countries.  
Argentina was eager to further d eepen bilateral trade links by ta king advantage of the opportunities 
offered by Economic Complementarity Agreemen t No. 58 between Peru and MERCOSUR.  Its 
objective was to further expand trade, especially in pr oducts such as olive oil, dairy products, textiles, 
cement, stationary, and medicines.  He inquired about the state of progress with draft Law 
No. 633/2006-CR abolishing the domestic production regime governing medicines, established by 
Peruvian Law No. 27.143. 
48. The representative of Japan  welcomed recent favourable economic circumstances in Peru.  
The steady management of Peru's macroeconomy, con tinuous structural reform , and the expansion of 
domestic demand and trade based on a favourable exte rnal environment had contributed significantly 
to this outcome.  Peru had reduced its tariffs si gnificantly in January 2007;  it assigned priority to 
trade with Asia.  Peru needed to continue to take such favourable measures in order to play a 
significant role as a member of the WTO and as th e APEC chair in 2008.  Nevertheless, Peru's 
priority was the fight against poverty.  Peru lack ed appropriate infrastructure in some sectors.  
Progress could be achieved on this front by attaining sustainable growth through trade and appropriate 
assistance.  In this regard, th e successful high level dialogue on aid for trade in Peru in 
September 2007 had enabled WTO Members to share c oncrete ideas on 'what' and 'how' to do in this 
area. 
49. The increase in international prices of mining prod ucts was a major factor in the high growth 
of Peru's economy and of exports.  He asked about specific measures, including the Sierra 
Exportadora programme, to diversify Peru's economy to prepare for possible future price declines in 
the mining sector.  Although important progress had been made since 2000, infrastructure problems 
persisted in certain activities.  He appreciated the construction of a new container terminal at the port 
of Callao and asked when it would come into operatio ns.  Peru was neither a party nor an observer to 
the plurilateral GPA.  Important changes had been  made to the regulatory framework on government 
procurement.  He asked whether the new 20 per cen t preference margin would result in higher costs 
for taxpayers and about the prospect of Peru's participation in the GPA. 
50. The representative of Hong Kong, China  noted that bilateral trade in the first seven months of 
2007 had increased by 33.7 per cent, compared with  the same period in 2006.  Peru supported the 
multilateral trading system by participating actively and constructively in the DDA negotiations.  Peru 
and Hong Kong, China, were among the Members th at had submitted a 'middle-ground' proposal in 
NAMA in June 2007.  Regarding trade policy, Peru  had continued to liberalize its trade regime 
through unilateral initiatives since 200 0:  he encouraged Peru to continue its reform, including of 
some services sectors.  Far-reaching changes in the regulatory framework of the telecommunications 
sector had reduced barriers to market entry.  Th is had benefited the sector  and had brought positive 
spill-over effects.  The experience gained should be a pplied to other services sectors.  Peru needed to 
use its multilateral commitments to advance and lock-i n the results of liberalization.  This would help 
sustain its current rate of economic growth and would provide a secure basis on which to further 
spread the benefits of liberalization and continue  reducing poverty.  He urged Peru to consider 
improving its services offer by undertaking comm itments in some important sectors, including WT/TPR/M/189 
Page 18  
 
  maritime transport services and core freight logis tics services.  On market access for goods, Peru had 
reduced its average MFN tariff from 13.6 per cent in 1999 to 8.2 per cent in 2007 and had taken steps to simplify and computerize its customs procedures.  It had also bound its entire tariff schedule, mostly at 30 per cent.  These initiatives provided certain ty to its trading partners and helped facilitate 
the flow of international trade.  He encouraged Pe ru to further enhance the predictability of its tariff 
regime by reducing the water in its schedule.  Virtually all the final anti-dumping measures adopted 
before 2000 had been revoked at the end of 2006 :  Peru observed closely the five-year sunset 
requirement in Article 11.3 of the Anti-Dumping Agreement.  Peru should continue its measured 
stance in extending anti-dumping measures and in considering new anti-dumping measures, which had risen during the period under review. 
51. The representative of Ecuador
 noted that the Peruvian ec onomy had developed steadily over 
the past six years, registering average GDP growth of 4.8 per cent per year and an average annual increase in exports of 8.3 per cent over that same period.  Thanks to prudent economic management 
and Peru's trade policy, growth levels had been maintained and had even increased, also allowing 
Peru to benefit from the multilateral trading system .  Peru was Ecuador's partner in the Andean 
integration process and in the negotia tion of an Association Agreement with the European Union.  In 
the Andean Community framework, a free trade zone had been operating since 2006, and work 
towards an enhanced common ma rket also encompassing services, capital and persons was under 
way.  Peru was Ecuador's second largest trading pa rtner.  The value of Ecuador's exports rose from 
US$53 million in 1996 to US$740 million in 2006.  The border dispute with Ecuador had been 
resolved with the signing and ratificati on of the Brasilia peace accords in 1998. 
52. Peru was an active WTO Member and participant in the Doha Round.  Peru and Ecuador held 
similar views on the multilateral trading system and the expectations of developing country Members 
as well as the achievements that the latter awaited from the outcome of the Doha Round.  Peru and 
Ecuador, along with other developing country Me mbers, had co-sponsored the liberalization of 
tropical products and produc ts constituting a legitimate alternativ e to illicit crops.  The two countries 
also advocated fair recognition of special and diffe rential treatment.  They were both members of the 
G-20.  They agreed on the prohibition of fisheries subsidies, the revision of the TRIPS Agreement to incorporate provisions aimed at protecting biodiver sity and traditional knowledg e, and the opening of 
Mode 4 to workers from developing country Memb ers.  Tariff reductions had resulted in a tiered 
structure that increased effective levels of tariff protection in certain sectors.  He urged Peru to 
continue binding its trade commitments. 
53. The representative of Honduras
 noted the favourable performance of the Peruvian economy 
and the fact that inflation had been brought under control.  The fiscal situation had improved and the 
public debt had decreased.  Trade and investment  had grown thanks to the favourable external 
environment, contributing to Peru's good economic results in recent years.  Peru's progress in facilitating trade was evidenced by the shorter cu stoms clearance times for goods  subject to physical 
or documentary inspection.  Trade relations register ed a trade balance in favour of Peru.  Peruvian 
imports into Honduras included No. 6 fuel oil (Bunker C), preforms for beverage  containers, fishmeal, 
and hydrogen chloride.  Imports of those produc ts had increased considerably between 2004 and 
2006.  Honduran exports to Peru consisted inter alia  of wooden furniture, r eservoirs, tanks, vats and 
similar containers, and machinery fo r finishing paper or paperboard. 
54. The representative of Nigeria
 noted that Peru's trade had increased between 2000 and 2006, 
due to the responsible management of monetary an d fiscal policies.  In addition, the economy had 
registered trade and current account surpluses.  Furthe r growth was expected in the next five years as 
a result of progressive opening of the economy and infr astructural and institutional reforms.  Exports 
of goods and services had increased in real terms at  an annual rate of 8.3 per cent during 2000-06, 
while the equivalent rate for impor ts had been 7 per cent.  The share of merchandise trade in GDP had 
risen from 27 per cent in 2000 to 41 per cent in 2006.  About 30 per cent of Peru's active population  WT/TPR/M/189 
 Page 19 
 
 
  was unemployed, which was not a healthy condition for a country with such a level of growth:  Peru's 
reform efforts should consider how best to tackle  this problem.  Peru had engaged in aggressive 
bilateral trade negotiations, in addition to its act ive participation in re gional and sub-regional 
arrangements, such as the Andean Community and APEC.  Nigeria and Peru had no formal trade 
relations:  Nigeria hoped that discussions could take place on how to engage meaningfully in trade, in 
the context of the new initiative on Africa-South America cooperation. 
55. The representative of Bolivia  stated that the General Inte gration and Economic and Social 
Cooperation Treaty with Peru had strengthened bilateral relations between the two countries.  The 
Treaty covered border, socio-economic and political  development programmes.  Peru and Bolivia 
were working to strengthen the Andean Community .  Together with the other Andean country 
partners, they had signed a Free Trade Agreement with MERCOSUR.  The region was seeking to 
create a Union of South American Nations.  As An dean Community members, Peru and Bolivia were 
negotiating an Association Agreement with the Europ ean Union.  In the multilateral sphere, they were 
members of the Cairns Group, the G-20 and the G-33 , and had shared interests regarding tropical and 
alternative products and the relationship betw een the TRIPS Agreement and the Convention on 
Biodiversity.  Bolivia commended Peru for its  economic performance.  Peru had become a 
preferential business partner on account of its macroeconomic stability.  It took an active and constructive part in the Doha R ound.  Peru's tariff structure,  incentives programmes and sectoral 
development policies had made the country a net e xporter of agricultural products in a favourable 
international price environment.  Peru had a policy of  State participation in strategic sectors.  It was 
striving to preserve and strengthen the Quechua and In caica cultures.  The challenges before it were to 
reduce poverty, eliminate illiteracy and extend health and sanitation coverage. 
56. The representative of Singapore
 noted that Peru's growth had been steady over the past 
five years, as a result of efforts to liberalize its trade regime, mostly through unilateral initiatives and 
broader structural reform.  These efforts had primed Pe ru to reap the benefits of a favourable external 
environment.  Some of the challenges that it n eeded to address included improving infrastructure, 
reviewing regulations, and further reforming certain  services sectors.  In 2006, trade flows between 
Peru and Singapore had grown by 55.1 per cent, more  than the average annual growth in total trade 
between Singapore and Latin America.  Singapore's companies had also identified diverse potential 
sectors for investments in Peru, such as seafood,  procurement and manufacturing operations, and 
textile and garment manufacturing.  Singapore had proposed negotiations with Peru for an avoidance 
of double taxation agreement.  Singapore's bilatera l economic relationship with Peru continued to 
strengthen.  The recent conclusion of the Peru-Si ngapore FTA negotiations bore testimony to this.  
The FTA was comprehensive in coverage and include d chapters on goods, rules of origin, technical 
barriers to trade, investment, customs procedures, and competition.  Overall, the market access package would see the elimination of duties on the ma jority of tariff lines upon entry into force of the 
agreement.  The FTA would also establish a libera lizing framework that would encourage bilateral 
trade in services.  Singapore and Peru had agreed to sign the FTA during the meeting of the APEC 
Trade Ministers in Peru in 2008.  Besides APEC, Singapore and Peru were also members of FEALAC 
(Forum for East Asia – Latin America Cooperation) .  Both APEC and FEALAC had as one of their 
objectives the expansion of common ground on importa nt international economic issues.  In this 
regard, Singapore was looking forward to working closely with Peru as it assumed the Chairmanship 
of APEC in 2008.  An FTA that was comprehensiv e and of a high standard would complement the 
WTO in liberalizing global trade and would help to speed up trade liberalization in Peru and 
Singapore.  Peru and Singapore also had clear interests in the successful conclusion of the Doha Round negotiations.  She commended Peru for its active participation in the DDA negotiations. 
57. The representative of India
 noted that economic activity in Peru had grown by 8 per cent in 
real terms in 2006, the highest rate in 11 years.  Trade liberalization had allowed Peru to reap the 
benefits of a favourable external environmen t, and helped explain Peru's robust economic 
performance since 2000.  Exports of goods and services had expanded at an annual rate of 8.3 per cent WT/TPR/M/189 
Page 20  
 
  between 2000 and 2006, and imports at  7 per cent.  However, Peru faced significant challenges, 
including a lack of adequate infr astructure, excessive regulation, and deficiencies in the system of 
public security and justice administ ration.  Formal unemployment remained sizeable and most of the 
labour force was engaged in the informal sector.  Bila teral relations were cordial and friendly.  Since 
Peru's last Review, Indian exports to Peru had increased from around US$26 million to 
US$125 million, and imports from Peru had increased from around US$10 million to US$128 million.  
In the information technology area, Aptech and N IIT had entered the Per uvian market.  Peru's 
membership of APEC had given it added importance for India. 
58. The representative of El Salvador
 welcomed Peru's solid economic  growth in recent years and 
the trends in the principal macroec onomic variables.  Peru had conti nued to liberalize its trade regime 
since its last Review.  It had participated in 14 di spute settlement cases, two as a complainant, four as 
a defendant, and eight as a third party.  Peru and El Salvador had plans in the political, diplomatic, 
economic, trade, cultural and tourism spheres.  Th ey also had an agreement on the promotion and 
mutual protection of investments.  El Salvador 's entrepreneurs had welcomed the possibility of 
establishing closer bilateral trade relations.  Inte llectual property protection and trade remedies were 
the responsibility of a single body, INDECOPI, whic h had authority to grant compulsory licences on 
grounds of public interest, emergency or national security.  The system of protection of the rights of breeders of new plant varieties had been develope d on the basis of Supreme Decree No. 08 96-ITINCI 
and Andean Decision 345.  Peru was not, however,  a member of the International Union for the 
Protection of New Varieties of Plants.  It protect ed geographical indications  through "appellations of 
origin " and "indications of source".  The Un ited States and the European Communities, which 
accounted for 37 per cent of Peru's total trade, were the country's leading trading partners.  Bilateral 
trade relations were expanding.  El Salvador's exports to Peru had increased between 2005 and 2006, 
and consisted mainly of bakery machinery and m achinery for the manufacture of macaroni, spaghetti 
or similar products, and sprayers. 
59. The representative of Uruguay
 noted that Peru took an active part in the affairs of the WTO 
and was firmly committed to the multilateral trading system.  Peru also promoted trade liberalization 
as the key to economic growth and development.  It had continued to liberalize its trade regime since 
its last Review.  In the context of broader structur al reform, trade liberalization had allowed Peru to 
reap the benefits of a favourable external envi ronment and helped explain its robust economic 
performance since 2000.  Such sound perform ance had been accompanied by a process of 
liberalization and modernization of Peru's tr ade regime and been the outcome of prudent 
macroeconomic management and implementation of sustained struct ural reforms.  Peru was an active 
participant in the WTO negotiations, sharing Uruguay's commitment to securing a prompt and ambitious conclusion to the Round.  WT/TPR/M/189 
 Page 21 
 
 
  V. REPLIES BY THE REPRESENTATIVE OF PERU AND ADDITIONAL COMMENTS 
60. The representative of Peru  noted that since 2000 the Peruvian economy had been focusing on 
consolidation of the open trade pr ocess initiated in the 1990s, the stra tegic areas being unilateral tariff 
liberalization and the trade negotiations.  Peru's tari ff policy lines targeted efficiency in the allocation 
of resources and greater wellbeing through the lowe ring of production costs and consumer prices.  
Peru had continued to further liberalize its trade.   By mid-October 2007, it had significantly changed 
its tariff structure, reducing the number of levels and tariffs for a considerable number of headings.  
The nominal average rate had been 8.3 per cent and tariff dispersion had stood at 8 per cent in 
April 2007.  There had been five tariff levels.  With the changes, the nominal average rate was down 
to 5.8 per cent, tariff dispersion had been reduced to  6.2 per cent, and tariff levels had been cut down 
to four.  As a result of the changes, the highest ta riff level of 20 per cent applied to only 13 headings, 
covering beef and beef products, which accounted fo r no more than 0.1 per cent of the value of 
imports.  Seventy per cent of imports were down to  zero per cent duty and 96 per cent were assessed 
at 9 per cent or less.  The 5 per cent additional duty,  which had applied to 390 headings in April and 
89 headings up to July 2007, had been abolished as a result of the changes.  The fiscal cost of 
modifications to the tariff structure was of th e order of US$240 million.  Tariff variation and 
differentiated effective protection was not the same fo r high tariffs as it was for low tariffs, as was the 
case of Peru.  As to concern about the high di fferential between the bound tariffs and the tariffs 
actually applied, Peru supported the most ambiti ous reduction proposals leading to broader market 
access in agricultural and non-agricu ltural areas.  The undertakings Peru would make in respect of its 
bound levels would be the result of a coherent a pproach and of what would be agreed upon in the 
Doha Round negotiations. 
61. INDECOPI enjoyed functional, technical, administrative and budgetary autonomy.  The 
document to which the Secretariat Report referred had been reviewed at the Latin American Competition Forum organized by the OECD in Se ptember 2007, which had recognized INDECOPI's 
autonomy and independence.  The members of the various Commissions and those of the court's 
chambers were appointed on the basis of their qualifications and professional experience and served 
for long periods, during which they enjoyed independ ence of action.  Ninety per cent of INDECOPI's 
financing came from intellectual property registration fees and fees for other services, and the State contributed the remainder.  INDECOPI was therefore funded by the services it provided and not by the fines it imposed for anti-competitive practices.  That was why there was no additional financing 
mechanism.  INDECOPI's operations were self-financing. 
62. Expeditious customs procedures were critical to  integration in international markets.  A 
World Bank study indicated that it took 31 days to complete Peruvian import operations.  The study took into account the period between the date of arri val of the goods and that on which they received 
authorization for clearance.  The length of that peri od was not exclusively attributable to the customs 
authorities, since it included the time required by a ll agents in the foreign trade logistics chain, 
including the carrier and the cargo agent, and tho se at the storage terminal.  The processing time for 
Peruvian customs was counted from the date of s ubmission of the Single Customs Declaration.  
Considerable progress had been achieved in that rega rd in recent years, as clearance times had been 
reduced by 30 per cent since 2002.  It took between 2.3 and 5.9 working hours to clear goods subject to documentary control;  between 13.4 and 19 working hours for those undergoing physical 
inspection;  and less than two hours for those that were not subject to control, which represented 65 
per cent of imports.  There were major challenges to be dealt with in the customs sphere.  Peru was 
working on the implementation of a single foreign trade window – a system aimed at standardizing, streamlining and integrating the procedures of entiti es in charge of controlling restricted goods with 
customs administration, introducing electronic processing, and markedly reducing the costs and time needed to obtain goods import and export licences a nd certification and for cu stoms clearance.  Early 
2009 at the latest was the date estimated for fi nal and full implementation of the single window 
facility. WT/TPR/M/189 
Page 22  
 
  63. As to questions concerning import licences and restrictions, there was freedom of imports of 
merchandise into Peru, and there was therefor e no import licensing.  On the other hand, the 
importation of certain goods could be prohibited or restricted for exceptional reasons such as 
protection of health or the environment and natio nal security, as was the case in most countries.  
Permits for restricted goods, which were controlle d by various entities, were issued under a unified 
customs procedure covering all the necessary import formalities. 
64. The increase in the number of anti-dumping actions in recent years was partly the 
consequence of dynamic trade.  Peru was purchasing a great deal more in external markets, which 
explained the increase in and identification of a hi gher number of unfair practices.  The number of 
applications was lower than the number of measure s actually applied.  The phenomenon was part of a 
growing trend in that respect all over the world.   The cases brought were always examined in 
conformity with multilateral rules and in the light of WTO case law.  Peru awaited from the 
Doha Round a more rigorous mechanism that would prevent it from being misused. 
65. Peru had worked very hard to ensure that technical barriers did not constitute disguised 
para-tariff barriers to trade.  Supreme Decree No. 149-2005-EF, adopted in 2005, had established a 
centralized technical process prior to the provision of regulations for the verification of compliance 
with transparency and technical regulation notification procedures, the principles of the TBT Agreement and those of rationality and pr oportionality of measures as enshrined in the 
Constitution.  The supervision mechanism ensured th at there was no restriction to freedom of trade 
and that the objective was to contribute efficiently to the fulfilment of legitimate goals such as the 
protection of health, the environment, and animal  or plant life.  Peru accepted the results of 
conformity assessment carried out by agencies accre dited in Peru or in third countries in some 
regulated sectors. 
66. The "simplified" duty drawback scheme applied solely to high value-added exports, which 
accounted for 25 per cent of total exports.  The si mplified mechanism had been selected because it 
guaranteed low administrative costs.  Exporters t hus recovered the amount of duties they had paid on 
imported inputs at the lowest possible administrative cost to the State.  As to incentives, the Council 
of Ministers had decided in early 2007 to reorga nize and streamline tax exem ptions, having evaluated 
the need for them and their impact on economic gr owth.  Incentives that had no effect on wellbeing 
would be abolished.  The Framework Law that ha d been put forward called for deeper and better 
assessment of the cost, benefit and effectiveness of  the new exemption proposals, the beneficiaries 
thereof, as well as their scope and consistency with  domestic legislation and Peru's international 
undertakings.  A timetable for the gradual phasing out  of exemptions granted in certain regions of 
Peru had been established.  Incen tives were accordingly part of an  orderly phase-out plan and would 
be granted in a more rational manner, on the basis of technical criteria, in order to ensure the 
wellbeing of the population. 
67. Peru did not intend to become an observer to the WTO Plurilateral Agreement on 
Government Procurement.  Peru's position should not be interpreted as l ack of interest in the matter.  
Peru considered that the conditions afforded by th e Agreement were not favourable to its interests and 
that the Agreement's thresholds were too high.  In practice, only the major countries could take 
advantage of the opportunities arising from government  procurement.  Peru would be prepared to 
undertake full commitments at any level of governme nt as well as market access obligations;  above 
all, Peru wanted low thresholds.  Those elements  were not covered by th e Agreement.  Peru had 
succeeded in accommodating its interests in its bilate ral commitments.  It had also been improving its 
domestic legislation, introducing amendments and proposals that brought greater transparency to 
government procurement procedures. 
68. 
Peru would be hosting the APEC leaders su mmit in November 2008.  Under the theme 
"APEC Peru 2008:  A new commitment for Asia-P acific development", Peru had decided to give  WT/TPR/M/189 
 Page 23 
 
 
  prominence to the social dimensions of the age nda for the next summit and at the preparatory 
meetings during 2008.  It would prioritize topi cs such as education to promote competitiveness, 
development assistance and modernization of small and medium-size enterprises, the promotion of 
technological cooperation programmes to narrow the digital gap, and the promotion of corporate 
social responsibility practices. 
69. Traces of plant products and species had been  found in the Caral pyramids dating back 
approximately 6000 years, which suggested that Peru's ancestors had known the properties of their 
plants and their genetic resources.  That knowle dge had been passed on down to the present day.  
Hence Peru's considerable interest in protecting its genetic resources and th e traditional knowledge of 
its indigenous peoples and native communities, and its dedication to combating biopiracy.  Peru 
considered it essential for the patent system to guara ntee effective defence of that which belonged to 
21st century Peruvians, having been handed down to them by Peruvians living thousands of years 
before.  It was one of the issues that Peru would c ontinue to promote in the Doha Round, in the belief 
that a freer multilateral trading system also had to be  more open, more efficient and more equitable.  
Intellectual property issues had not always been easy  to address.  It had cost the developing countries 
a great deal to undertake commitments in that area, sometimes at the expense of more primary matters 
such as health.  Peru's proposal might be viewed as innovative but there was no reason to fear novelty.  
It was a fair proposal, which balanced the intell ectual property system and afforded protection for 
those that had fewer means to defend their rights. 
70. The challenge facing Peru, in which trade policy played a key role, was how to ensure more 
equitable distribution of the benefits of economi c growth across the population and thus alleviate 
poverty, especially in rural areas.  Opening up tr ade was a necessary though not a sufficient pre 
requisite for the growth and distribution process to  succeed.  The challenge was not an easy one, but 
Peru had already begun to address the task without the slightest doubt that trade policy would help 
achieve that goal.  Peru would bring to the next  Review of its trade policy an even more positive 
outlook than it had at the current meeting. 
71. The discussant  appreciated the elimination of the surcharges on imports.  He noted the 
impressive and excellent institutional structure of INDECOPI.  Challenges remained in the area of 
customs procedures, as Peru moved to adopt measures such as a single window system, and the drawback mechanism required further work.  The tr ansparency of government procurement had been 
enhanced.  He appreciated the clear manner in wh ich Peru had presented intellectual property rights 
issues at the WTO.  There were important APEC  issues that intersected with the WTO agenda, 
including the promotion of trade and growth.  Peru  had a rich culture and history, and was doing well 
in a modern economy including in areas like invest ment, competition policy, intellectual property, 
deregulation, and privatization. 
72. The representative of the United States
 thanked Peru for its replies.  It looked forward to 
working with Peru in concluding the DDA and co mpleting the Peru-US FTA. 
73. The representative of the European Communities  encouraged Peru to continue working 
towards a more efficient government procurement system and further liberalization of trade in 
services.  It was important to continue efforts to  reinforce close political and economic ties between 
Peru and the EC through the negotiation of an asso ciation agreement with the Andean Community.  
The agreement would be negotiated on a region-to-re gion basis to provide further impetus to the 
regional integration process in the Andean Community .  This was crucial to foster stability, progress, 
and sustainable development in the region, and would help to place it in the world economy by 
developing larger and more stable economies, able to attract investment.  Further work was important 
on streamlining all aspects of customs procedures a nd regimes, eliminating non-tariff barriers, and 
harmonizing rules and regulations in all trade-re lated areas in the framework of the Andean 
Community.  Peru played a key role in these negotiati ons, particularly regarding the trade pillar, since WT/TPR/M/189 
Page 24  
 
  Peru had taken the lead in the trade negotiations.  Peru should enhance its leadership in the region and 
participate actively in the 'region-to-region' negotiations. 
74. The representative of Canada
 highlighted the mutually reinforcing link between protecting 
cultural diversity and social development.  He asked whether a mining company could undertake exploration activities even when th ere was some community opposition to a project, and whether this 
type of activity would qualify as "specific invest ment" on a concession, therefore exempting the 
company from paying any penalties. 
75. The representative of Chile
 said that he would study Peru's replies, particularly on anti-
dumping.  Chile was looking forward to working with Peru on new disciplines in this area.  WT/TPR/M/189 
 Page 25 
 
 
  VI. CONCLUDING REMARKS BY THE CHAIRPERSON 
76. The Third Trade Policy Review of Peru has allo wed this Body to consider Peru's trade and 
investment policies and practices against the backdrop of its economic  and institutional environment.  
Our discussions have benefited greatly from the active participation of Vice-Minister Ferreyros, 
Ambassador Ponce, Ms Elmore and the rest of the Peruvian delegation, the thoughtful intervention by 
the discussant, Ambassador Gosper, and the involvement of many delegations. 
77. Members commended Peru's solid economic growth  in recent years, underpinned by prudent 
macroeconomic policies, structural reforms, and a favourable global economic environment.  
Nevertheless, they noted that Peru still faces challenges in translating these achievements into 
stronger improvements in social indicators including poverty reduction.  Members encouraged Peru to 
persevere with structural reforms, including t hose necessary to eliminat e bottlenecks created by 
inadequate infrastructure, as a means to  sustain its recent economic performance. 
78. Members welcomed Peru's commitment to the multilateral trading system and its support for 
the DDA.  They noted Peru's ambitious preferentia l trade agenda, including its participation in the 
Andean Community, the recently completed agreem ent with the United States, and the several 
ongoing bilateral negotiations.  Peru was invited to no tify its preferential agreements to WTO in order 
to enhance their transparency. 
79. Members praised Peru's liberalization of its tr ade regime, including the unilateral reduction of 
applied MFN tariffs.  However, some noted that the tariff structure had lost uniformity, resulting in increased effective assistance to some  sectors.  In response to Members' questions, Peru indicated that 
it has recently abolished the tariff surcharge applied on certain products, but that the elimination of the 
price band system is not under discussion.  Peru was encouraged to enhance th e predictability of its 
trade regime by eliminating the gap between bound and applied tariff rates. 
80. Members welcomed Peru's efforts to facilitate  trade, although some considered customs 
clearance procedures to be lengthy and complex.  Concerns were also expressed about the increase in 
anti-dumping investigations, and the use of a simplif ied duty drawback scheme.  Peru gave detailed 
information about its policies and practices regarding technical regulations and SPS measures.  It also 
indicated that consideration is being given to re ducing local preferences in government procurement 
but not to acceding to the GPA.  Peru stressed the total independence of its competition authority, 
while some Members considered it desirable to  strengthen further this important entity. 
81. In response to concerns about its use of incentiv e programmes, Peru noted that its current aim 
is to reduce fiscal distortions, and that steps are being taken to apply stricter assessment criteria to 
future programmes and to phase out others.  Peru also indicated that it is working on formally 
abolishing local-content requirements for dairy products, and reassessing income tax benefits 
contingent on the use of domestic inputs. 
82. With respect to service activities, Members noted the considerable liberalization that Peru has 
undertaken in areas such as telecommunications and fi nancial services.  However, they also pointed to 
certain restrictive measures in areas such as maritime  and air transport, and the need to accelerate the 
modernization of ports.  Peru provided responses to  Members' specific questions concerning activities 
such as telecommunications, banking, maritime and air transport, as well as professional services. 
83. I would like to conclude this meeting by congrat ulating Peru for its steadfast support of trade 
liberalization as a development tool.  In Peru, lib eralization and sound econom ic policies have paid 
off with much improved external and internal balances as well as robust economic growth.  But 
additional reforms are necessary to raise productivity and, critically, distribute the gains from trade 
more widely.  Thus, I welcome Peru's renewed em phasis on improving social indicators, as well as its WT/TPR/M/189 
Page 26  
 
  ongoing efforts to strengthen its institutions and infrastru cture.  I invite Peru to bind its reforms in the 
WTO in order to give greater predictability to its trade regime, and thus further promote investment 
and growth. 
__________