Manufacturing

In a context where efficiency and quality are crucial, the Peruvian manufacturing sector is becoming a key pillar of the national economy. With a robust and diversified production base, Peru is establishing itself as a regional benchmark, known for its ability to deliver high-quality products and maintain international competitiveness.

FDI in manufacturing

Period: 2003 - April 2024

Two operators operating a forklift, symbolizing foreign investment in the logistics sector

USD

Millions of FDI in the sector.

Photo: Shutterstock

Source: fDi Markets (2024)

View of a motorcycle chain, symbolizing projects carried out in various manufactures

Projects in total.

Photo: Shutterstock

Source: fDi Markets (2024)

Two logistics operators working in a warehouse

Jobs generated

Photo: Shutterstock

Source: fDi Markets (2024)

Potentials in manufacturing

  • Lima

  • Moquegua

  • La Libertad

  • Ica

  • Cajamarca

  • Arequipa

  • Piura

Map of Peru with diverse manufacturing potential in Lima
Map of Peru with diverse manufacturing potentialities in Moquegua
Map of Peru with potentialities in diverse manufacturing in La Libertad
Map of Peru with the potentialities in diverse manufacturing in Ica
Map of Peru with the potentialities in diverse manufacturing in Cajamarca
Map of Peru with potentialities in diverse manufacturing in Arequipa
Map of Peru with the potentialities in diverse manufacturing in Piura

Sector highlights

%

In 2022, Peru's Gross Domestic Product generated more than S/. 70 billion.

Source: BCRP Weekly Note N°8-2023

%

Growth in industrial employment during 2021, representing more than 2 million jobs.

Source: PRODUCE-OGEIEE-OEE; Manufacturing Production Bulletin Dec 2022.

°

Peru is a leading producer of zinc and tin, and ranks as the 2nd largest producer of gold, lead, and molybdenum in Latin America. Additionally, it holds the distinction of being the world’s top country in silver reserves.

Source: Peru Mining Country-MINEM and US Geological Survey -USGS.

More information

Subsectors of interest

Photo:

Metalmechanics

  • Peru has vast metal reserves throughout its territory.
  • At the regional level, it attracts large investments from international companies.
  • It supplies intermediate and final goods to different sectors.
  • Peru is of interest to international mining and metals companies.
  • In 2021, exports of the Metalmechanics subsector reached approximately USD 645 million FOB.
  • The sector generated 349,200 jobs in 2021

Mining Supply and Services

  • Installed capacity and technological innovation to meet international market demand.
  • High added value, thanks to its transformation, engineering development and technological innovation.
  • Ability to adapt to market needs.
  • Peruvian industry offers lower costs and rates for mining services than those available in the U.S. and European markets.
  • The mining and auto parts supplier subsector achieved an FOB export value of USD 519 million.

Construction Materials and Finishes

  • The industry produces high-quality products that are well-recognized across the Latin American market.
  • The internationalization of construction finishing products has been achieved.
  • In South America, Peru ranks third for the lowest labor costs in establishing a construction materials manufacturing plant.
  • In 2022, exports from the Construction Materials and Finishes sector accounted for 18.6 % of manufacturing exports, making it the third-largest subsector in terms of export share.

Containers and Packaging Line

  • Peru ranks second in South America for the most competitive operating costs to establish a plastics manufacturing plant.
  • The Peruvian plastics industry has adapted to the growing consumer demand for biodegradable packaging and recyclable labeling. Key sectors such as agriculture, fishing, pharmaceuticals, cosmetics, and gastronomy are the primary consumers of these packaging products and services.
  • Production levels have surpassed those recorded before the pandemic, with a notable 40 % growth observed in December 2021 alone.

Tax incentives

Anticipated recovery of the General Sales Tax (RERA IGV)

It allows projects with long pre-operational periods to recover the IGV of the investments made in goods, services, construction contracts or others, facilitating the liquidity of the company and improving its financial structure. 
Law N°. 31661: Temporary flexibility of the amount of investment to benefit from the regime. 
Requirement: The investment commitment for a tourism project must be at least USD 2 million, reduced from the previous minimum of USD 5 million.

Drawback

The refund allows for the reimbursement of a percentage of the FOB value of exported goods. This refund compensates for the customs duties incurred on the import of inputs used in producing the exported goods, which have increased production costs. The refund amount is equivalent to three percent (3 %) of the FOB value of the exported goods, up to a maximum of fifty percent (50 %) of the production cost, based on the rate in effect at the time of application approval. This refund is considered a tax benefit. It's essential to ensure compliance with the application requirements for this incentive.

For more information: https://www.gob.pe/1207-drawback

Law N°. 27037: Law for the Promotion of Investment in the Amazon Region.

Taxpayers based in the Amazon region whose businesses involve industrial activity, tourism, and other sectors will be subject to income tax rates of either 10% or 5% on third-category income, depending on their specific locality.

Special Economic Zones (SEZ)

These are designated areas within the national territory where productive and service activities are focused, particularly on foreign trade businesses.

Companies operating within Special Economic Zones (SEZs) benefit from a special customs and tax regime for a specified period. The benefits, exemptions, and terms for goods in the Special Development Zones (ZED) of Ilo, Matarani, and Paita are extended until December 31, 2042. For the Tacna Free Trade and Commercial Zone (ZOFRATACNA), the benefits are valid until December 31, 2041.

For more information: https://www.gob.pe/7868-ministerio-de-comercio-exterior-y-turismo-zonas-economicas-especiales-zee

Tax stability regime for mining companies

Instruments used to provide the investor with the security and peace of mind that the regulations applicable to such investment will not vary during a determined period of time.
10 years: With operations between 350 MT/day and 5 thousand MT/day, or those with investment programs of US$ 20 million.
12 years: With operations between 350 MT/day and 5 thousand MT/day, or those with investment programs of US$ 100 million in the case of new mining companies and US$ 250 million for existing mining companies.
15 years: With operations of more than 15 thousand MT/day, or those with expansions aimed at reaching a capacity of not less than 20 thousand MT/day.

Law N°. 27623. Emergency Decree N°. 021-2019.

Refund of the IGV for the mining sector. Refund of the IGV and Municipal Promotion Tax to the holders of the mining activity during the exploration phase.

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