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Peru, an agricultural exporter,

offering great opportunities to

Martin Davila ChocanoMartin Davila Chocano

 Agra Consult Inc. Agra Consult Inc.

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Peru Offers a favorable legal framework forPeru Offers a favorable legal framework for

foreign investmentforeign investment

Non-discriminatory treatment.

Unrestrictive access to most economic sectors. No performance requirements.

Free transfer of capital.

.

Guarantee for private property.

Freedom to purchase stocks from locals.

Freedom to access internal and external credit.

Freedom to pay royalties.

Network of investment agreements and member of ICSID andMIGA.

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GDP of the last 4 years

Year Gross GDP (US$ million) GDP growth (%) GDP per capita

YEAR GDP US GDP GROWTH % GDP PER CAPITA

2005 148,716 6.7 126,4

 , . ,

2007 174,328 9.0 143,9

2008

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Economic GrowthEconomic Growth

2004 2005 2006 2007 2008

GDP (%Change) 5.1 6.4 7.6 8.9 9.4

Private Investment (% Change) 8.1 12.0 20.1 23.2 24.6

Public Investment (% Change) 5.7 12.2 13.0 19.7 44.7

PCI (% Change) 3.5 1.5 1.1 2.9 5.8

Jobs in company with 10 or more workers 3.6 5.7 8.7 8.9 8.4

Exports (% Change in US$) 40.9 35.3 36.9 17.5 11.1

Capital Goods Imports (% Change in US $) 19.6 29.6 35.4 41.9 60.3

Condtruction GDP (% Change) 4.7 8.4 14.7 16.6 17.0

Tax Collection (% Change) 13.6 14.3 27.8 15.3 10.3

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Foreign InvestmentForeign Investment

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Sustained economic growth with annual forecasted

average rate greater than 7% for 2006 – 2011

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Peru has reached the Investment Grade

COUNTRY S&P FITCH MOODY

Chile A+ A A2Mexico BBB+ BBB Baa1

Peru BBB- BBB- Ba1

Brasil BBB- BBB- Ba1

Colombia BB+ BB+ Ba1

Venzuela BB- B+ B2

Argentina B- RD B3

Bolivia B- B- B3

Ecuador SD RD Ca

Source: Standard & Poor's, Fitch Ratings and Moodiy's

Updated: January 2009

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 A Legal system that guarantees basic

rules and statutes that will not change

Legal Stabilty Legal Stabilty  Agrrements Agrrements

Guarantees Recognized by the StateGuarantees Recognized by the State

INVESTORS

Non discriminatory treatmentNon discriminatory treatment Income tax rules applicable to dividends.

Stability to use freely the most favorable exchange rate

available in the market.

Free availability and remittance of foreign currency,dividends and royalties.

RECEIVING COMPANY 

Recruitment regimes.

Regimes for the promotion of exports.

Income Tax Regime

Requirement: Minimum investment of US$ 5 MM in any economic sectors.

US$ 10 MM for hydrocarbon and mining sectors.

 Validity: 10 years. Concessions: Term according to the contract’s life (Max. 60 years).

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 With a steady tax regime, which main taxes are:

TAX Applicable Rate

Corporate Profits 30.00%

Income Agriculture, agribusiness and aquaculture 15.00%

.

Royalities 30.00%

Interes rate on loans from abroad 4.99%

Value Adde Tax (VAT / IGV) 19.00%

Financial transactions tax 0.06% throughout 2009

temporal to net assets for more than S/. 1 million 0.40%

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Special Regime of Advanced Recovery of IGV tax

BENEFITS

Granting the return of the General Sales Taxduring the pre productive stage of the project.

 Applicable to all sectors of economic activity.

  It is not necessary for agricultural activity to meet aminimum investment amount.

 The project can be divided by stages, phases, or

similar levels. Applicable to projects with pre - productive stages with:

 A minimum 2 year term

Minimum investment amount of US$ 5 million.

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 Tariffs with 0% rate from february first 2009 Tariffs with 0% rate from february first 2009

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 Tariffs from Peru to US under the FTA  Tariffs from Peru to US under the FTA 

schedule for the reduction of trade tariffs Total tariffs %

A 6,417 60.34%F 3,991 37.53%

B 3 0.03%

C 21 0.20%

D 51 0.48%Q 4 0.04%

R 1 0.01%

S 17 0.16%

With specific quota 129 1.21%TOTAL TARIFFS 10,634 100.00%

A & F effective on February 01 2009

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Central bank survey of 274

large companies, 2007-2008

(US$ millions)

Fishing 224 149

Mining and fuel 1,146 1,411

Manufacturing 1,142 1,570

Electricity, water and gas 310 457

Construction 96 122

Commerce 476 679

Transport and Telecom. 636 811

Services 28 55