Peru: Exports continue to contract at double-digit pace and trade deficit widens in March
May 8, 2015
In March, the trade balance registered a USD 522 million deficit, which was considerably larger than the USD 92 million shortfall observed in the same month of last year. March’s deficit was wider than the USD 228 million shortfall registered in February.
Exports suffered another significant drop in March, contracting 17.9% over the same month last year (February: -22.2% year-on-year). Exports have contracted at a double-digit rate in the past four months. Meanwhile, imports fell 4.7% in March, which followed the 5.1% contraction in February.
In the 12 months up to March, the trade balance posted a deficit of USD 2.2 billion. The trade balance peaked at a record-high surplus of USD 9.8 billion in February 2012. It has narrowed almost uninterruptedly since then and shifted to deficit in April 2014. This trend has been driven by falling global demand and decreasing prices for traditional Peruvian exports, such as copper, silver and natural gas. The increase in import volumes has also affected the trade balance negatively.
Author: Carl Kelly, Economist