Peru’s Exports to China Surge 325% Since 2010, Diversification Remains a Challenge

Peru’s exports to China have experienced remarkable growth since 2010. The value of these exports reached $23.152 billion in 2023, marking a 325% increase from 2010 levels.

This significant growth coincides with the implementation of the Free Trade Agreement (FTA) between the two countries. Peru’s role as the host of the 2024 Asia-Pacific Economic Cooperation (APEC) Forum presents a unique opportunity.

This event allows Peru to strengthen its relationship with China, a key APEC member and Peru’s primary trading partner. The timing couldn’t be better for exploring new avenues of trade.

Despite the impressive growth, the composition of Peru’s exports to China remains largely unchanged. Traditional exports, primarily raw materials, continue to dominate the trade relationship.

These products account for approximately 91% of Peru’s total exports to China. The dominance of traditional exports reflects China’s industrial economy and its position as a global manufacturing hub.

China’s demand for raw materials drives this trend. Copper, iron, and lead top the list of Peru’s exports to China. In 2023, these mineral exports to China amounted to $18.340 billion.

This figure represents 79% of Peru’s total exports to the Asian giant. While impressive, this concentration highlights the need for diversification.

Peru’s Export Diversification to China

Experts believe there’s room to balance Peru‘s export basket to China. The upcoming inauguration of the Chancay port in November presents a significant opportunity.

This new infrastructure could help overcome logistical challenges in exporting to Asia. Among Peru’s top non-traditional exports to China, seafood products feature prominently.

Giant squid leads this category, with exports valued at US$182 million in 2023. Agricultural products like blueberries, grapes, and avocados also show promise.

The Peruvian Ministry of Agriculture has identified 133 tariff items currently exported globally but not to key Asian markets, including China. These products represent potential new export opportunities for Peru.

The optimized FTA between Peru and China, set to be signed in November, could further boost export diversification. The agreement includes improvements in areas such as sanitary measures and customs procedures.

Peru’s National Agrarian Health Service (SENASA) plays a crucial role in introducing new Peruvian products to foreign markets.

For 2024, SENASA aims to secure market access for 13 new Peruvian products, including pomegranates and frozen fruits for China.

As Peru looks to diversify its exports, the government’s plan to promote more privately managed free trade zones could provide additional support.

This initiative, along with targeted investments in exportable manufacturing, could help balance Peru’s export portfolio to China.