UN Tourism’s launch of the ‘Tourism Doing Business: Investing in Peru’ focused on foreign investment trends in the tourism sector, highlighting Peru as a top destination for tourism investment.
During the launch, presented by the Ministry of Foreign Trade and Tourism of Peru and the Development Bank of Latin America and the Caribbean (CAF), recognition plaques were awarded to seven towns chosen as Peru’s Best Tourism Villages in 2022 and 2023.
Key takeaways from the ‘Promoting Foreign Investment: Launch of the Tourism Doing Business Investment Guidelines-Investing in Peru and General Guidelines for the Development of Public Investment in Tourism’ include:
Peru is making steady progress in post-pandemic visitor recovery, with 25.7% growth by 2023. In addition, its cultural and natural heritage position it as a highly attractive destination for investment.
- Between 2018 and 2023, Peru ranked among the top four countries in Latin America and the Caribbean in announcements for greenfield foreign direct investment (FDI) projects in the tourism sector.
- Since 2005, the public sector has allocated around USD 621.4 million to tourism activities and projects through the public investment budget. This support is set to continue, with an additional projection of USD 93.5 million by 2024.
UN Tourism Secretary-General Zurab Pololikashvili stated, “Peru is making steady progress in post-pandemic visitor recovery, with 25.7% growth by 2023. In addition, its cultural and natural heritage position it as a highly attractive destination for investment. The UN Tourism guidelines “Tourism Doing Business – Investing in Peru” is a fundamental tool highlighting the numerous business opportunities offered by the tourism sector of this wonderful country.”
Sergio Diaz-Granados, CAF’s Executive President, added, “CAF wants to contribute to the positioning of Peru for investment in tourism and to take advantage of the enormous potential offered by the sector. The country is an example in taking advantage of its unique attractions and is a destination characterised by its innovation and creativity. With the delivery of the Tourism Investment Guide, the alliance signed in January of this year between CAF, UN Tourism and the Peruvian government, represented by the Ministry of Foreign Trade and Tourism, to support the development of this sector, which is key to generating employment and boosting the country’s productivity, is materialized.”
Elizabeth Galdo Marín, Minister of Foreign Trade and Tourism of Peru, said, “Tourism is a key driver for the economic and social development of our country. With a rich cultural and natural diversity, Peru is positioned as a privileged destination for sustainable tourism. The collaboration with UN Tourism and CAF to include a special chapter on green investments and another on gastronomy in this guide underlines our commitment to responsible and sustainable tourism development.”
Heritage and Gastronomy
Peruvian gastronomy draws inspiration from the country’s biodiversity and the fusion of Andean, Amazonian, European, Asian, and African food. This sector puts the spotlight on locally sourced regional dishes.
Peru’s archaeological, historical and cultural wealth and its biodiversity and natural heritage make it an excellent option for tourism investments. This diversity allows for various tourism offerings aligned with environmental preservation.
Incentives For Foreign Direct Investment
Peru offers several incentives for foreign direct investment. Non-fiscal incentives include:
- Companies can be 100% foreign-owned.
- Low minimum capital requirements to start a company.
- The possibility of opening accounts in different currencies.
- A streamlined business incorporation process.
Specific incentives for foreign investment in tourism include:
- Value Added Tax (VAT): MSMEs in restaurant, hotel and tourist accommodation activities are subject to 10% of the final sales price, in contrast to the general 18%.
- Special Regime for the VAT Early Recovery: This mechanism has benefited more than 41 investors between 2007 and 2023, providing more than USD 700 million in liquidity.
- Amazon Law: Offers special tax conditions, with an IR between 5% and 10%, to promote tourist activities.
The ‘Tourism Doing Business Guide in Peru’ provides an overview of Peru’s investment landscape:
- Between 2018 and 2023, 360 greenfield projects were announced in the tourism sector in Latin America and the Caribbean, with a total investment of USD 29,528 million and expectations of creating 115,815 jobs.
- Currently, 6.8% of Peru’s economically active population (1.2 million people) are employed directly or indirectly in the tourism sector. This figure is projected to increase to 1.3 million in 2024, 13.5% over 2023.
- The contribution of tourism to the Gross Domestic Product (GDP) in 2023 was 2.5%, but forecasts indicate that it will be 2.9% in 2024.
- Between 2005 and 2024, USD 621.4 million of public investments were allocated to the tourism sector, and the budget for 2024 alone is already USD 93.5 million.
Peru’s Ministry of Foreign Trade and Tourism has decided to promote 10 investment projects in the guide, representing a portfolio of USD 650 million. These projects are only some of the tourism developments on the cards for Peru.
Natalia Bayona, Executive Director of UN Tourism, added, “The outlook for tourism investment in Peru is very positive. Between 2018 and 2023, the country was among the top four countries in Latin America and the Caribbean in announcements of greenfield FDI investment in tourism. This data shows us that it is important to invest in tourism and that this may be an unbeatable time to do so.”
