Peru: Exports continue to tumble as trade balance registers record deficit
July 7, 2014
In May, the trade balance registered a record deficit of USD 746 million, which was considerably greater than the USD 272 million deficit observed in the same month last year and exceeded April’s USD 661 million deficit. In the 12 months up to May, the trade balance posted an all-time record deficit of USD 1.5 billion.
Exports contracted 21.9% over the same month last year in May (April: -8.6% year-on-year), which represented the largest decline in almost five years. Meanwhile, imports decreased 7.8% in May, which contrasted April’s 1.7% expansion and marked the steepest drop since October 2009.
A downward trend in the trade balance has been observed over the past two years amid falling international prices for traditional Peruvian exports, such as copper, silver and natural gas. Similarly, the increase in import volumes has also affected the trade balance negatively despite lower international prices.
Author: Carl Kelly, Economist