Peru Freight Transport Report Q1 2012
Includes 3 FREE quarterly updates
BMI View We believe the Peruvian economy will decelerate in 2012, a view which has been reinforced by Q211 GDP data. Peru's growth trajectory will be supported by a growing private sector and a likely uptick of public spending in 2012, although uncertainty surrounding the outlook for fiscal expenditure poses risks to our growth projections beyond 2012.
While public expenditure should pick up, we still see private consumption being the main driver of growth as incomes rise and consumer credit becomes more widespread, boosting import volumes at ports. Private consumption grew by 6.4% y-o-y in Q211 and added 4.3 percentage points to the headline growth rate. Thus, consumers do not seem to have been significantly affected by the decline in government spending in Q211. Furthermore, we see strong potential for growth in private consumption 2011 and 2012 as Humala focuses on boosting the disposable income of the poorest segments of Peruvian society.
Headline Industry Data
Key Industry Trends
Future Looks Bright For Peruvian Ports As They Position Themselves As Gateway To Asia BMI notes upside risk to our forecasts for the Peruvian port of General San Martín, due to the government's announcement that it would concession the port before the end of 2011. BMI believes the port is well placed to take advantage of Asian demand for Peru's natural resources, particularly copper, and as such we expect the concession to attract plenty of international interest.
Peru Aims To Close Port Investment Gap, Improvement Needed Across Freight Sector
BMI maintains its view that Peru is well placed to position itself as a 'gateway to Asia' for Latin American exports. However, efforts to do so may be stymied by the lack of investment in infrastructure.
It seems the government is now trying to close the gap in funding to improve competitiveness and efficiency, with a US$2bn investment in the port sector. The news bolsters our view that Peru has the potential to become a regional logistics centre, providing strong growth opportunities for shippers and shipping lines.
Push To Become Gateway To Asia Continues
Peru's push to position itself as South America's 'gateway to Asia' continues. Private investment promotion agency Proinversión was expected to award a tender for the much-feted transcontinental railway project in Q411. The news bolsters our view that Peru has the potential to become a regional logistics centre, providing strong growth opportunities for shippers and shipping lines. BMI believes that when completed the railway will allow Peru to take advantage of Brazil's rapidly increasing raw material exports to China.
Key Risks To Outlook
BMI believes risks to our Peruvian port and shipping forecasts are mainly on the upside, with increased private consumption possibly leading to greater demand for containerised goods. Despite concerns during the presidential campaign, we expect consumption to benefit from President Ollanta Humala's economic policies. Humala's new economic plan does not include increasing taxes on consumers. In fact Humala will seek to reduce VAT in the coming years, supporting consumer demand.
Downside risks come in the form of a possible slowdown in Chinese demand, which would hit shipments of copper and other raw materials from Peru.
BMI View We believe the Peruvian economy will decelerate in 2012, a view which has been reinforced by Q211 GDP data. Peru's growth trajectory will be supported by a growing private sector and a likely uptick of public spending in 2012, although uncertainty surrounding the outlook for fiscal expenditure poses risks to our growth projections beyond 2012.
While public expenditure should pick up, we still see private consumption being the main driver of growth as incomes rise and consumer credit becomes more widespread, boosting import volumes at ports. Private consumption grew by 6.4% y-o-y in Q211 and added 4.3 percentage points to the headline growth rate. Thus, consumers do not seem to have been significantly affected by the decline in government spending in Q211. Furthermore, we see strong potential for growth in private consumption 2011 and 2012 as Humala focuses on boosting the disposable income of the poorest segments of Peruvian society.
Headline Industry Data
- We expect growth of 8.6% in total tonnage throughput at the port of Callao, to 20.2mn tonnes.
- We predict air freight volume to increase 8.7%, to 266,000 tonnes in 2012.
- We expect rail freight carried (volume x distance) to grow an impressive 8.0%, to 1.3bn tonnes/km in 2012.
Key Industry Trends
Future Looks Bright For Peruvian Ports As They Position Themselves As Gateway To Asia BMI notes upside risk to our forecasts for the Peruvian port of General San Martín, due to the government's announcement that it would concession the port before the end of 2011. BMI believes the port is well placed to take advantage of Asian demand for Peru's natural resources, particularly copper, and as such we expect the concession to attract plenty of international interest.
Peru Aims To Close Port Investment Gap, Improvement Needed Across Freight Sector
BMI maintains its view that Peru is well placed to position itself as a 'gateway to Asia' for Latin American exports. However, efforts to do so may be stymied by the lack of investment in infrastructure.
It seems the government is now trying to close the gap in funding to improve competitiveness and efficiency, with a US$2bn investment in the port sector. The news bolsters our view that Peru has the potential to become a regional logistics centre, providing strong growth opportunities for shippers and shipping lines.
Push To Become Gateway To Asia Continues
Peru's push to position itself as South America's 'gateway to Asia' continues. Private investment promotion agency Proinversión was expected to award a tender for the much-feted transcontinental railway project in Q411. The news bolsters our view that Peru has the potential to become a regional logistics centre, providing strong growth opportunities for shippers and shipping lines. BMI believes that when completed the railway will allow Peru to take advantage of Brazil's rapidly increasing raw material exports to China.
Key Risks To Outlook
BMI believes risks to our Peruvian port and shipping forecasts are mainly on the upside, with increased private consumption possibly leading to greater demand for containerised goods. Despite concerns during the presidential campaign, we expect consumption to benefit from President Ollanta Humala's economic policies. Humala's new economic plan does not include increasing taxes on consumers. In fact Humala will seek to reduce VAT in the coming years, supporting consumer demand.
Downside risks come in the form of a possible slowdown in Chinese demand, which would hit shipments of copper and other raw materials from Peru.
Contents
Executive SummarySWOT Analysis
Peru Freight Transport Industry SWOT
Peru Political SWOT
Peru Economic SWOT
Peru Business Environment SWOT
Industry Trends And Developments
Maritime
Road
Rail
Market Overview
Global Oil Products Price Outlook
Industry Forecast
Air Freight
Table: Air Freight, 2008-2016
Maritime Freight
Table: Maritime Freight - Throughput, 2008-2016 ('000 tonnes)
Rail Freight
Table: Rail Freight, 2008-2016
Trade Overview
Table: Trade Overview, 2008-2016
Table: Key Trade Indicators, 2008-2016 (US$mn and % change y-o-y)
Table: Peru's Main Import Partners, 2002-2009 (US$mn)
Table: Peru's Main Export Partners, 2002-2009 (US$mn)
Political Outlook
Domestic Politics
Long-Term Political Outlook
Macroeconomic Outlook
Table: Peru – Economic Activity, 2011 - 2016
Company Profiles
Agunsa
LAN Cargo
Ferrocarril Central Andino
Country Snapshot: Peru Demographic Data
Section 1: Population
Table: Demographic Indicators, 2005-2030
Table: Rural/Urban Breakdown, 2005-2030
Section 2: Education And Healthcare
Table: Education, 2002-2005
Table: Vital Statistics, 2005-2030
Section 3: Labour Market And Spending Power
Table: Employment Indicators
Table: Consumer Expenditure, 2000-2012 (US$)
Table: Average Annual Manufacturing Wages, 2000-2012
BMI Methodology
How We Generate Our Industry Forecasts
Transport Industry
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