Peru‘s economic growth accumulated five consecutive quarters by rising 3.9% in the first quarter of 2025.
This rebound is explained by the momentum of private spending. Consumption and investment strengthened, amid higher employment, low inflation and lower interest rates. Even residential investment showed signs of recovery after 10 quarters of decline.
In addition, government spending also helped growth. However, net exports declined. Imports grew strongly, especially in industrial inputs and capital goods, outpacing the advance in exports.
Peru’s economic growth
In 2024, the Peruvian economy grew 3.3%. This was a clear recovery from the 0.6% drop recorded in 2023, the sharpest since 1990 if the 2020 collapse due to the pandemic is excluded.
Behind the poor performance in 2023 were several factors. The coastal El Niño hit key crops and sectors. Drought affected production in rural areas. In addition, social conflicts paralyzed entire regions. Added to this was the drop in business confidence and the impact of the political cycle on public investment.
Despite these ups and downs, Peru maintains an open economy. It has low tariffs and few trade restrictions. Its model is still based on exports of minerals, agribusiness and services.
Although it faces structural challenges such as informality and regional inequality, the country shows signs of resilience. With monetary stability, trade openness and a favorable investment environment, the Peruvian economy remains among the most dynamic in Latin America.
Trade Agreements
Peru is a founding member of the Andean Community of Nations (CAN) and the Pacific Alliance, together with Chile, Colombia and Mexico. It also participates in agreements with MERCOSUR, the European Free Trade Association (EFTA) and the European Union.
At the bilateral level, Peru has signed treaties with strategic partners. These include Cuba (2001), Chile (2009), the United States (2009), Canada (2009) and Singapore (2009). Also noteworthy are China (2010), South Korea (2011), Thailand (2011), Mexico (2012) and Japan (2012). Other relevant agreements were finalized with Panama (2012), Costa Rica (2013), Venezuela (2013) and Honduras (2017).
During the last few years, trade expansion continued. Peru signed five new treaties. In 2014, it advanced in the Pacific Alliance with Mexico, Colombia and Chile. In 2016, it closed an agreement with Brazil. And in 2017, with Honduras, and in 2018, with Australia. That same year, it also joined the Trans-Pacific Partnership Comprehensive and Progressive Agreement (CPTPP), which groups 12 countries.