Miners lead Peru tax-swap infrastructure projects in 2013

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Monday, January 6, 2014

Mining companies topped a surge in investment in Peruvian tax swap infrastructure projects through 2013, the government said.

Companies including Glencore Xstrata (LSE: GLEN), Gold Fields (NYSE: GFI), Antamina, Buenaventura's (NYSE: BVN)La Zanja unit and Mina La Poderosa led the 403mn soles (US$144mn) in 35 investment projects known as Obras por Impuestos in 2013, state investment promotion agency ProInversión said.

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The figure tripled the 138mn soles invested in 19 projects in 2012, ProInversión said in a statement. Companies have invested a total of 831mn soles since 2009 in tax swap ventures, largely transport, water treatment and health projects, benefiting 4.5mn people, the agency said.

Southern Copper (NYSE: SCCO) has invested 250mn soles, followed by Volcan (BVL: VOLCABC1) with 76.4mn soles, Gold Fields with 18.5mn soles, Barrick Gold (TSX: ABX) with 14.2mn soles, Antamina with 10.6mn soles, Milpo (BVL: MILPOC1) with 7.5mn soles and Glencore Xstrata with 3mn soles, ProInversión said.

Arequipa region has led tax swap projects since 2009 with 263mn soles, followed by Puno (216mn), Pasco (103mn soles) and Junín (79.9mn soles), according to Proinversión.

Peru needs to invest at least US$35bn in infrastructure projects such as roads, ports and airports to lower costs and be able to compete with neighboring countries such as Chile, according to business group Confiep.

Peru's mining industry, the world's third largest copper and zinc producer, accounts for about 60% of the country's export revenue and about half its tax income.