Peru Exports: Economy's Life Support

Peru is a developing country in South America. In 2004, its Human Development Index score was 0.767. Its per capita income in 2006 was 3,374 US dollars. More than half of its population is poor. A little below 20% is extremely poor. The economic performance of the country has been struggling for decades to the point that its neighboring countries have left it out in the economic race. What's interesting about the country's economy is that it is highly dependent on its export industry. In fact, its exports have been providing hard currency to finance the country's imports and pay external debts.

Two-thirds of Peru's exports are raw materials. A huge bulk of the country's export commodities are comprised of ores, copper, precious stones, oils and mineral fuels. The top export partners of Peru are the United States and the European Union. The United States is Peru's leading trading partner. Peru is the 44th biggest source of US imports, which accounted for $5.1 billion in 2005 alone. Gold is the top commodity that Peru exports to the US. It constituted more than 30 percent of all the US imports in 2005. Refined copper followed next, constituting 11 percent. Kerosene and other oils rank third, comprising 9 percent total.

The European Union is Peru's second most important trading partner. It accounts for less than 25 percent of the country's total exports and 22 percent of imports. Ore, copper and precious metals are also the top export commodities. Peru's other important trading partners include Asian countries Japan and China, and neighbors Chile and Brazil.

In 2005, Peru's exports improved by more than 35 percent. This was primarily because of the increased rates of ore prices. Although exports provide substantial revenue, a more egalitarian income distribution and self-sustained growth remain elusive for Peru.