Macchu Picchu Peru

Peru Economy

Peru economic overview

Volatile economic growth trajectory:

Located on the western coast of South America, Peru boasts the sixth-largest economy in Latin America, with a GDP of around USD 240 billion in 2022 and a population of 34 million. It is classified as an upper-middle-income economy by the World Bank, though GDP per capita is still below the Latin American average. Peru's economy experienced significant growth in the decade leading up to the pandemic, often exceeding 4% year on year. However, the economy saw a double-digit contraction in 2020, and eked out soft growth in 2022 and 2023 below the Latin America average, weighed on by socio-political instability.

Free trade promoter:

Peru is an active promoter of free trade, being a member of the Andean Community along with Bolivia, Colombia, Ecuador, part of the Pacific Alliance together with Chile, Colombia and Mexico, and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). Peru also has trade deals in place with the EU and the U.S.

Large mining sector:

Peru's economy is characterized by its reliance on natural resource exports, particularly mining, as well as a growing services sector. Peru is the world's second-largest copper producer, and is also an important producer of gold and zinc. That said, mining activity has been periodically disrupted in recent years by protests by local communities; these protests are also weighing on investment in the sector.

Chronic political instability:

Peru's congress is highly fragmented, with dozens of political groupings enjoying parliamentary representation, making policymaking difficult. Moreover, congress has in recent years frequently removed sitting presidents; the country has seen five presidents since 2020. This is hampering structural economic reforms and holding back investment.

Challenges:

In addition to the aforementioned political instability, the Peruvian economy faces challenges including social unrest, a weak education system, exposure to fluctuations in commodity prices and vulnerability to extreme weather events—including the El Niño climate phenomenon, which tends to bring heavy rains.

Peru's economic outlook:

Peru still holds significant potential for growth, given its growing consumer market, abundant natural resources, attractiveness as a tourism destination and large web of trade agreements. Our Consensus is for growth to return to rates above the regional average in the coming years, though the economy will remain restrained by political disfunction.

Peru's economy in numbers:

Nominal GDP of USD 245 billion in 2022.

GDP per capita of USD 7,169 compared to the global average of USD 10,589.

Average real GDP growth of 3.2% over the last decade.

Share of the region's population
Share of the region's GDP

Economic structure:

In 2020, services accounted for 62% of overall GDP, manufacturing 12%, other industrial activity 18%, and agriculture 8%. Looking at GDP by expenditure, private consumption accounted for 61% of GDP in 2021, government consumption 14%, fixed investment 23%, and net exports 2%.

GDP by economic sector
GDP by type of expenditure

International trade:

In 2020, manufactured products made up 9% of total merchandise exports, mineral fuels 4%, food 26%, ores and metals 44% and agricultural raw materials 1%, with other categories accounting for 16% of the total. In the same period, manufactured products made up 74% of total merchandise imports, mineral fuels 9%, food 14%, ores and metals 1% and agricultural raw materials 1%, with other goods accounting for 1% of the total. Total exports were worth USD 66 billion in 2022, while total imports were USD 56 billion.

Key exports
Key imports
Key export partners
Key import partners

Economic growth:

The economy recorded average annual growth of 3.2% in the decade to 2022. To read more about GDP growth in Peru, go to our dedicated page.

Fiscal policy:

Peru's fiscal deficit averaged 1.9% of GDP in the decade to 2022. Find out more on our dedicated page.

Unemployment:

The unemployment rate averaged 7.6% in the decade to 2022. For more information on Peru's unemployment click here.

Inflation:

Inflation averaged 3.3% in the decade to 2022. Go to our Peru inflation page for extra insight.

Monetary Policy:

Peru's monetary policy rate ended 2022 at 7.50%, up from 4.25% a decade earlier. See our Peru monetary policy page for additional details.

Exchange Rate:

From end-2012 to end-2022 the sol weakened by 31.6% vs the U.S. dollar. For more info on the sol, click here.
The economy contracted at a softer year-on-year pace in Q4 than in Q3, due to revived consumer spending, faster public spending growth, and a lesser decline in fixed investment. Our panel projects the economy to have bounced back year on year in Q1 2024. In January-February, annual economic activity rebounded from Q4’s average drop. Moreover, in January-March, business sentiment improved, and inflation decreased from Q4. That said, merchandise exports rose at a softer clip than in Q4. Meanwhile, in late April, S&P Global Ratings lowered the country’s rating from ‘BBB’ to ‘BBB-’ with a stable outlook. The rating agency considers that a fragmented Congress and the administration's restricted political leverage are dampening investor sentiment and hampering Peru's ability to rebuild fiscal space.
Projections out to 2033.

53 indicators covered including both annual and quarterly frequencies.

Consensus Forecasts based on a panel of 46 expert analysts.

Want to get insight on the economic outlook for Peru in the coming years? FocusEconomics collects projections out to 2033 on 53 economic indicators for Peru from a panel of 46 analysts at the leading national, regional and global forecast institutions. These projections are then validated by our in-house team of economists and data analysts, and averaged to provide one Consensus Forecast you can rely on for each indicator. This means you avoid the risk of relying on out of date, biased or outlier forecasts. Our Consensus Forecasts can be visualized in whichever way best suits your needs, including via interactive online dashboards , direct data delivery and executive-style reports which combine analysts' projections with timely written analysis from our in-house team of economists on the latest developments in the Peru economy. To download a sample report on the Peru's economy, click here . To get in touch with our team for more information, fill in the form at the bottom of this page .

Peru Economic Data

2018 2019 2020 2021 2022
Population (million) 31.6 32.1 32.6 33.0 33.4
GDP (USD bn) 228 233 206 226 244
GDP per capita (USD) 7,211 7,251 6,329 6,845 7,312
GDP (PEN bn) 748 778 722 878 937
Economic Growth (Nominal GDP, ann. var. %) 5.9 3.9 -7.2 21.7 6.6
Economic Growth (GDP, ann. var. %) 4.0 2.2 -10.9 13.4 2.7
Domestic Demand (ann. var. %) 4.1 2.2 -9.6 14.5 2.4
Total Consumption (ann. var. %) 3.6 3.4 -7.0 11.0 2.9
Private Consumption (ann. var. %) 3.8 3.2 -9.9 12.4 3.6
Government Consumption (ann. var. %) 2.4 4.3 7.9 4.8 -0.2
Fixed Investment (ann. var. %) 4.4 3.3 -16.2 34.6 0.7
Exports (G&S, ann. var. %) 2.1 1.1 -19.7 13.3 5.2
Imports (G&S, ann. var. %) 2.4 0.9 -15.2 17.9 3.9
Manufacturing Production (ann. var. %) 5.9 -1.7 -12.6 18.7 1.0
Commerce (ann. var. %) 2.5 2.5 -13.3 17.2 3.3
Unemployment (% of active population, eop) 6.1 6.1 13.8 7.8 7.1
Unemployment (% of active population, aop) 6.7 6.6 12.8 11.3 7.7
Fiscal Balance (% of GDP) -2.3 -1.6 -8.9 -2.5 -1.7
Public Debt (% of GDP) 25.5 26.5 34.5 35.8 33.9
Money (ann. var. of M2 %) 8.9 9.1 37.7 -4.0 0.4
Inflation (CPI, ann. var. %, eop) 2.2 1.9 2.0 6.4 8.5
Inflation (CPI, ann. var. %, aop) 1.3 2.1 1.8 4.0 7.9
Inflation (Core, ann. var. %, eop) 2.6 2.2 1.8 3.8 6.5
Inflation (WPI, ann. var. %, eop) 3.2 -0.1 1.6 13.6 7.0
Monetary Policy Rate (%, eop) 2.75 2.25 0.25 2.50 7.50
Exchange Rate (PEN per USD, eop) 3.38 3.31 3.62 3.99 3.81
Exchange Rate (PEN per USD, aop) 3.29 3.34 3.50 3.88 3.84
Current Account Balance (USD bn) -2.6 -1.4 1.9 -4.7 -9.7
Current Account Balance (% of GDP) -1.1 -0.6 0.9 -2.1 -4.0
Merchandise Trade Balance (USD bn) 7.2 6.9 8.1 15.1 10.2
Merchandise Exports (USD bn) 49.1 48.0 42.8 63.1 66.2
Merchandise Imports (USD bn) 41.9 41.1 34.7 48.0 56.0
Merchandise Exports (ann. var. %) 8.0 -2.2 -10.7 47.4 4.8
Merchandise Imports (ann. var. %) 8.1 -1.8 -15.5 38.2 16.7
Foreign Direct Investment (USD bn) 6.8 6.2 -0.4 5.8 11.7
International Reserves (USD bn) 60.3 68.4 74.9 78.5 72.2
International Reserves (months of imports) 17.3 20.0 25.9 19.6 15.5
External Debt (USD bn) 78.7 80.8 89.7 102.0 101.7
External Debt (% of GDP) 34.6 34.7 43.4 45.1 41.6

Q&A:

  1. How is the economy in Peru?

  2. Peru's economy has been dynamic in the last few decades but faces challenges. It benefits from rich natural resources, particularly in mining and agriculture, and has seen growth in sectors like manufacturing and tourism. However, it grapples with issues like income inequality, political instability, and reliance on commodity exports, which can be volatile.
  3. Does Peru have a strong economy?

  4. Peru has a growing economy with strong sectors in mining, agriculture, and fisheries. Peru is classified as an upper-middle-income economy by the World Bank and is a member of the Pacific Alliance and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). However, its economy faces challenges like income inequality, a chaotic political panorama and reliance on volatile commodity exports.
  5. Does Peru have natural resource wealth?

  6. Yes, Peru has abundant natural resource wealth, with copper, gold and iron among the country's top exports.

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