The International Monetary Fund's WEO (World Economic Outlook) report for October 2015 lists Peru among the strongest Latin American markets, projecting 2.4% GDP growth for 2015 and 3.3% for 2016, whereas South America as a whole is expected to report negative GDP growth figures, of -1.5% and -0.3%, for those periods.

In December 2014 the Lima chamber of commerce (CCL) went one better, projecting national GDP growth of 4.8% in 2015 and 5.2% in 2016, bouncing back from the 2.7% five-year low seen in 2014.

The CCL also projects increased investment across all industries, with private sector investment growing over 5% in 2015 and 2016 and public sector investment growing at 7% to 9%. In 2014 both private and public sector investment shrank, by 1.7% and 1.3% respectively.

It is doubtful that the telecom sector experienced such a decline in 2014, since the government moved ahead with a major backbone project, Chile's Entel announced aggressive investment plans for its Peruvian unit, and mobile newcomer Bitel was rigorous enough in its 2012-14 buildout to ensure that it reached its end-2015 goal of one million subscribers some two months ahead of schedule.

The CCL's GDP figures in fact show 5.9% growth in the 'general services' category for 2014, which includes information and communication technologies (ICT), and it was the mining, manufacturing and construction sectors that dragged overall GDP growth down to 2.7%. We assume that the same is true for investment, and that the telecom sector was atypical of the country as a whole.

However, some of the planned legal changes mentioned in our last Peru Telecom Intelligence Series have yet to achieve plenary approval, so not everything in the telecom segment is as dynamic as one would think.

Figure - Annual Growth of Key Services Since 2010


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