Peru: The land of paradise
3 August 2012
For a while, I have not contributed a blog for my fans because honestly, I haven’t experienced any event interesting enough to write about. However, yesterday I went to AEC seminar about FTA Thai-Peru and it seemed a worthwhile subject for a new contribution.
When you think about Peru, you might picture a country of ancient culture, the Incan Empire and also one of the famous Seven Wonders of the World, Macchu Picchu. Apart from the cultural wonders and the ancient air, Peru is a country with rich resources due to its natural variations. It is located on the Pacific coast of South America and its main geography can be separated into 3 parts; the coast, the highlands and the Amazon rainforest. An export driven country producing commodities such as gold, copper, silver, crude petroleum, coffee, potatoes and fish meal, Peru has a strong economic status – GDP growth across 2010-2011 averaged 6.9%.
In a world scarce in natural resources, plentiful countries such as Peru have an opportunity to build very strong economic status. The nation is a member of ALADI (Latin American Integration Association) and CAN (Andean Community of Nations) which makes it an interesting hub in the Latin American market. The FTA or Free Trade Agreement between Thailand and Peru is aimed to open more bilateral investment between the two countries. For Thailand, Peru represents an excellent hub for the distribution of Thai exports into the Latin American market and, conversely, Thailand is able to play a similar role for Peru in the South East Asian market.
Potential Thai business in Peru can also be found in the hotel and resort industry. Surprisingly, though a country of some of the world’s most ancient culture, attracting more than two million tourists per year, there are only a few five stars hotels to be found. With this in mind, Thailand has comparative advantage due to expertise in the hotel sector born out in a uniqueness of service, interior decoration style and spa & massage services. Furthermore, the Thai ambassador in Peru says Peruvians are big fans of the Thai hotel management style, which presents a great opportunity for entrepreneurial Thai hotel owners to invest in five stars hotels and resorts in Peru’s main cities, such as Lima and Cusco. Another potential market for Thai business in Peru is restaurants, as Peruvians and Thais have similar tastes in food. Our intense flavors featuring lots of spices and herbs will certainly appeal to the Peruvians’ love of eating out and trying new food.
There are two main concerns for Thai business developers thinking about investing in Peru; language and travelling distance. Peruvians nominally use Spanish for communication and flights from Thailand take 36 hours – return trips can therefore take three days! Apart from these, Peru is a very attractive market for brave investors who are willing to do their homework and put lots of effort into exploring a new market. There should be no doubt of a decent return for serious investors with prudent plans and solid partners.
However, Rome was not built in a day and it is the same with business. Profits might not in the early stages, but with patience and a precise plan, the end results will be ample reward. So be brave, take the risk and you won’t be disappointed.