Peru is seeking investment from the UAE for a planned major logistics hub on the Pacific coast and also hopes to convince Dubai’s Emirates Airline to launch flights to its capital, the South American nation’s Economics and Finance Minister told Arabian Business.
Peru, whose main exports are tin, copper, zinc and fresh produce, sold about $30m worth of goods to the Gulf state last year, and since 2010 has received up to $1.5bn in investment from the UAE.
One of the largest investments the country has seen was $600m from Dubai’s DP World to operate one of the terminals at Lima’s Callao Port. Luis Miguel Castilla Rubio said that the government now hopes to convince DP World to invest further into a planned logistics zone that would link Collao with Lima International Airport and boost further the city’s credentials as an import/export hub.
“We’re just in the preliminary stages. The thing is the airport is next door to the main port in the country. We’re in the process of expanding the airport to double its capacity... it caters to about 10m,” he told Arabian Business.
“[Lima is] one of the busiest hubs in South America, so the potential is there to integrate both services – air cargo and shipping cargo. We’re in the preliminary stages of presenting a project to see if this suits DP World and other investors here,” Rubio added.
Rubio said he had met with the chairman of DP World, Sultan Ahmed Bin Sulayem during his visit, and had also held talks with sovereign wealth funds including Abu Dhabi’s Mubadala Development. He did not specify how much the Peruvian government was seeking for the project.
Rubio, who has run Peru’s finances since July 2011, added that his government was also in talks with Emirates Airline for the carrier to launch direct flights from Dubai to Lima. At present, Emirates only directly services cities in neighbouring Brazil and Argentina.
“We’ve also had talks with Emirates to begin preliminary visits to our country to see about the possibility of first having cargo flights to Lima and eventually passengers flights,” he said.
Rubio said that Peru was also seeking to lower trade barriers between the UAE and his country by removing remaining red tape. “We’re starting to negotiate a treaty to avoid double taxation, which should enable this process. We intend to begin either late this year or early next year, and also a bilateral investment treaty. We already signed an agreement with all Gulf countries, but I think more specific bilateral treaties with the UAE would definitely boost investment,” he said.
Rubio added that he believed Peru’s oil and gas, tourism and mining sectors were also ripe for UAE investment.
Peru, whose biggest trading partner is China, is forecasting more than 6 percent economic growth for the year, Rubio said. The country is the second largest for UAE investment in South America after Brazil, which he claimed represents the potential of the continent’s Pacific economies. “Towards the Pacific there’s a lot of dynamism and the growth in Latin America comes from these countries,” he said.