Recent UN Tourism initiatives highlight the robust growth of tourism investment in Peru and its potential to become a leading destination in Latin America for sustainable, culturally rich tourism projects.
Launched by the United Nations Tourism Office, “The Business of Tourism: Investing in Peru” focused on foreign investment trends in the tourism sector and highlighted Peru as a leading destination for tourism investments.
At a presentation organized by the Peruvian Ministry of Foreign Trade and Tourism and the Development Bank for Latin America and the Caribbean (CAF), plaques were presented to the seven towns selected as Peru’s best tourist villages for 2022 and 2023.
Key points from the document “Promoting Foreign Investment: Presentation of Tourism Business Investment Guidelines for Investment in Peru and General Guidelines for the Development of Public Investment in Tourism” include:
Peru ranks in the top four countries in Latin America and the Caribbean for the announcement of new foreign direct investment (FDI) projects in the tourism sector between 2018 and 2023. Since 2005, the public sector has allocated approximately US$621.4 million to tourism activities and projects through the public investment budget. This support is set to continue, with an additional US$93.5 million expected by 2024.
UN Tourism Secretary-General Zurab Pololikashvili said: “Peru is making steady progress towards a post-pandemic tourism recovery, with an expected growth of 25.7% by 2023. Furthermore, Peru’s cultural and natural heritage makes it a highly attractive country for investment. The UN Tourism Guidelines ‘The Business of Tourism – Investing in Peru’ are a fundamental tool to highlight the numerous business opportunities offered by the tourism sector of this great country.”
CAF Secretary General Sergio Díaz Granados added: “CAF wants to contribute to the positioning of Peru for tourism investment and take advantage of the enormous potential this sector offers. Peru is a good example of leveraging its unique attractions, a tourist destination characterized by innovation and creativity. The distribution of the Tourism Investment Guide fulfills the alliance signed in January this year between CAF, the United Nations Tourism Office and the Peruvian Government (represented by the Ministry of Trade and Tourism) to support the development of this sector, key for job creation and increasing the country’s productivity”.
Peru’s Minister of Trade and Tourism, Elisabeth Galdo Marin, said: “Tourism is a key driver of the economic and social development of our country. With its rich cultural and natural diversity, Peru positions itself as an exceptional destination for sustainable tourism. The inclusion of a special chapter on green investments and another on gastronomy in this guide, in collaboration with the United Nations Tourism Office and CAF, underscores our commitment to responsible and sustainable tourism development.”
Tradition and gastronomy
Peruvian cuisine draws inspiration from the country’s biodiversity and its fusion of Andean, Amazonian, European, Asian and African cuisines, with a particular focus on locally produced and regional specialities.
Peru’s rich archaeological, historical and cultural heritage, as well as its biodiversity and natural heritage, make it an excellent choice for tourism investments. This diversity allows the country to offer a wide range of tourism services in line with environmental protection.
Incentives for Foreign Direct Investment
Peru offers several incentives for foreign direct investment. Non-financial incentives include:
Companies can be 100% foreign-owned. Minimum capital requirements for company formation are low. Accounts can be opened in different currencies. Streamlined business incorporation process. Specific incentives for foreign investment in tourism include: Value Added Tax (VAT): Small and medium-sized enterprises involved in the restaurant, hotel and tourist accommodation business are taxed at 10% of the final sales price instead of the general 18%. Special VAT Early Recovery Mechanism: This mechanism has benefited more than 41 investors between 2007 and 2023, providing more than US$700 million in liquidity. Amazon Law: Provides special tax conditions with an IR of 5% to 10% to promote tourism activity. The “Guide to Tourism Business in Peru” provides an overview of the investment environment in Peru. Between 2018 and 2023, 360 greenfield projects were announced in the tourism sector in Latin America and the Caribbean, with a total investment of US$29,528 million and the creation of 115,815 jobs. Currently, 6.8% of Peru’s economically active population (1.2 million people) are directly or indirectly employed in the tourism sector. This figure is projected to grow to 1.3 million in 2024, a 13.5% increase from 2023. Tourism’s contribution to the gross domestic product (GDP) was 2.5% in 2023, but is projected to be 2.9% in 2024. Between 2005 and 2024, $621.4 million in public investments have been allocated to the tourism sector, with $93.5 million already in the 2024 budget alone.
The Peruvian Ministry of Foreign Trade and Tourism has decided to move forward with the 10 investment projects outlined in the guide, representing a portfolio of $650 million. These projects are just a small part of Peru’s planned tourism development.
UN Tourism Director Natalia Bayona added: “The outlook for tourism investment in Peru is very positive. Between 2018 and 2023, Peru was in the top four countries in Latin America and the Caribbean for announced greenfield FDI investments in tourism. This data shows that investment in tourism is important and that now may be the best time to do so.”
Vicky is co-founder and Editor-in-Chief of TravelDailyNews Media Network and is responsible for the day to day operations and financial direction. Vicky holds a BA in Tourism Business Management from the Athens Technical University and a Masters in Business Administration (MBA) from the University of Wales.
She has many years of experience in the travel industry, both academically and industrially, and has written/edited numerous articles for various tourism magazines.
