The Peruvian Mining Sector. Carlos Galvez President Sociedad Nacional de Minería, Petróleo y Energía

Transcription

1 The Peruvian Mining Sector Carlos Galvez President Sociedad Nacional de Minería, Petróleo y Energía Cámara de Comercio e Industria Peruano Japonesa August 2016

2 Evolution of important indicators in Peru GDP (US$ billions) Net International Reserves (US$ millions) Exports (US$ millions) Mining exports Public Budgets (S/. millions) 8,613 61,485 7,026 34,236 3,205 18, Country Risk (basis points) Population in Poverty 54.8% 21.8% Source: BCRP, INEI

3 Investment = suitable employment Suitable Employment (million person) - left axis Gross Private fixed Investment (millions of S/ 2007) - right axis , , ,000 80,000 60,000 40, ,335 20, Source: BCRP, INEI

4 Growth = improving quality of life Human Development Index , ,954 GDP per capita Índice Human de Development Desarrollo Humano Index (1=(1 best = mejor, /right axis) eje derecho) PBI GDP per per cápita capita (US$, eje /left izquierdo) axis) Source: PNUD

5 Investment is crucial to the country's growth The behavior of GDP corresponds to the evolution of investments Evolution of GDP and private investment (million 2007 soles) GDP Private Investment Source: BCRP, INEI, MINEM, Perupetro

6 The Mining Sector in that context

7 The Mining Sector in that context Mining & Energy Investment (% of private investment) 20% of private investment in the country comes from the mining sector. Hidrocarbons Hydrocarbons Electricity Mining 29% 2% 7% More than US$ 57 Billion were invested in the mining sector between 2001 and % 3% 20% 4% 4% Production growth 2015/2001 Cu 135% Zn 35% Ag 60% Fe 141% Au 5% Source: BCRP, INEI, MINEM, Perupetro

8 The Mining Sector in that context Represents 25% of revenue, for the past 10 years (corporate tax, royalties and other special taxes). Between 2001 and 2015 the Mining Sector contributed with S/. 88 Billion in taxes, royalties, IEM and GEM. fishing agriculture Other services Corporate tax, royalties and special taxes income by economic sector (last 10 years) Mining* S/. 38 Billion distributed resources to local and regional governments between 2001 and 2015 primary manufacturing construction non-primary manufacturing Hydrocarbons ** Receive Mining Canon: 22 Regional Governments, 1,782 Local Governments, and 42 National Universities. commerce Electricity & water * Includes the payment of mining royalty, IEM and GEM ** Includes the payment of hydrocarbons royalties Source: SUNAT, Perupetro, BCRP

9 The Mining Sector in that context 195,000 direct jobs Helps improving other economic sectors Yanacocha Lagunas Norte Source: BCRP, INEI, MINEM Antamina Milpo 100,000 directs jobs have been created in the mining sector since For each job in the mining sector, 9 jobs are created in other sectors. Source: IPE, INEI Lima Toromocho Shougan Antapaccay Las Bambas Minsur Cerro Verde Quellaveco Toquepala In 22 of the 25 regions in Peru, the mining activity is carried out.

10 mineral products (metal) and services transport, storage and postal services refined oil basic chemicals, fertilizers gas and electricity services, water financial services Professional, scientific and technical services machinery and equipment car rental, machinery and equipment others The Mining Sector in that context Key to the development of the country 9% of GDP (*) 56% of Peruvian exports (*) Source: BCRP, INEI, MINEM. (*) average of the last 5 years Domestic demand of the metallic sector (% of the total intermediate demand) Mining procurement in the national market (% of Manufacturing GDP) 14.1% 2.3% Source: INEI, CCD Source: IPE, INEI

11 Peru: mining country Potential identified in project portfolio Metals projects US$ 58,346 million US$ Million % of total Copper 41, % Gold 1, % Iron Ore 5, % Zinc % Silver % Others * 8, % * Phosphates, tin, potassium and poly metallic. Source MINEM (march 2016)

12 However, project implementation is dilating Executed investment and portfolio of mining projects* (US$ millions) Portfolio of mining projects* US$ 38,714 million Expansion, construction and EE approved: 42% Exploration: 58% Source: MINEM (*) Expansion projects, EIA approved and construction. Adjusted according to what has already been executed in March 2016.

13 However, today Global perception of investors about Peru Mining sector (Fraser survey 2015) 36 (109 jurisdictions) 10 places (about 2014) Source: Fraser Institute ( Survey of Mining Companies: 2015 )

14 Main consumer of Water However, What do people have in mind today? Pollutes Generates few jobs Exhaustible Resource Mining Industry High Profits Generates conflicts All Peru is concessioned Does not generate Added Value Few collective Benefits

15 The challenge is to add value to our resources Improve the competitiveness of the sector Having a mining sector that continues making discoveries. Generate critical mass and develop suppliers that get to grow nationally and internationally. Clustering Interconnecting actors along the production chain and sharing opportunities that mining creates for everybody. Strengthen institutions in the country Achieve real and permanent presence of the State and provide opportunities for all.

16 The challenge is to add value to our resources Build social peace. Promote transparency in the use of funds coming from mining for popular benefit. Improve efficiency and productivity in operations. Show our absolute environmental awareness and demonstrate evidence of the new mining reality. Maximize efficiency in water use in the mining sector and create water assets in favor of the population and agriculture.

17 Challenge of all: Move from growth to development Respecting the rule of law. Institutionality. Be present and proactive. Dialogue. Concrete actions. Transparency. Unity.

18 We have the potential to develop and to achieve this, Peru requires the efforts of government, business and population We must start today.

19 The Peruvian Mining Sector Carlos Gálvez President Sociedad Nacional de Minería, Petróleo y Energía Cámara de Comercio e Industria Peruano Japonesa, August 2016 Secuencia 01.mp4