Peru, one of the most import-
ant mining centres in South America, looks set for a second “mining boom” in the next few years, following on the first such boom in the mid-1990s, triggered by major economic 
reforms (including large-scale 
privatisations) and the restoration of security in the country.

“Looking forward, we feel we are preparing for a second round, as a sector, as we are looking at investment of up to $35-billion over the next five to seven years in new mines, expansion of existing ones, and new investment,” Peru National Society for Mining, Petroleum and Energy president Hans Flurry told USA Today last week. 
“Mining is a key sector in Peru’s development because it generates the resources that are necessary for growth: the money government needs to meet its constitutional obligations in providing healthcare, security and education.” The importance of this can be judged from the fact that Peru’s gross domestic product (in purchasing power parity terms) was estimated at $251,4-billion for last year.

Separately, Peruvian Finance Minister Ismael Benavides has warned against increasing the country’s mining taxes. “I don’t think this is a good time to evaluate a potential increase in mining taxes; we are about to welcome a further $40-billion or more in mining investment and only 10% to 12% of the territory with mining potential has been explored.”

Peru, he asserted, needed to 
attract more investment and stimulate further growth in mining, which would see mines opened in, and so benefitting, regions where currently there is no mining. “We should not calculate a potential increase in mining taxes, because it will immediately stop investment, raise concerns in the sector and undermine the country’s development.”

According to the Ministry of Energy and Mines, Peru’s mining sector grew by 6,2% in 2009. This included a 109% increase in exploration expenditure. 
Investment in the Peruvian mining sector is forecast to rise by 7% this year, compared with figures for last year, to reach some $3-billion. Between January and July this year, the country’s mining 
exports amounted to $11,6-billion, a 4,2% growth over the figure for the corresonding period in 2009.

Peru’s central bank reports that between January and July, the country’s zinc exports jumped by 80,1%, copper exports by 74,2%, while gold exports rose by 26%.

Downstream, exports of jewellery and iron and steel products in the first seven months of this year came to $74-million, a 61,5% 
increase, compared with figures for the corresponding period last year. 
Mining product exports amounted to $1,6-billion in July, a 20,5% increase over those for July 2009. 
Peru is today the world’s number one producer of silver, the number two in copper and zinc production, number three in tin, number four in lead, and number six in gold.

Over the past 15 years, the growth rate in the mining sector has exceeded the growth rate of the Peruvian economy as a whole, and it has become the country’s main economic motor. Mining is now responsible for 60% of the country’s exports and provides 120 000 direct jobs and 
400 000 indirect jobs in Peru, which has a total population of about 30-million.

“This is why I would like to see these [future] investments 
receive their permits and licences 
as quickly as possible, without any hiccups, so that we can show that mining is an activity that can be carried out with respect for the community and with a commitment to do things the right way from an environmental point of view, without having a negative impact on the environment where the activities are carried out,” said Flurry.

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