RESTRICTED Report No. WH-212a This report is for official use only by the Bank Group and specifically authorized organizations or persons. It may not be published, quoted or cited without Bank Group authorization. The Bank Group does not accept responsibility for the accuracy or completeness of the report. INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT INTERNATIONAL DEVELOPMENT ASSOCIATION PERU: ECONOMIC SITUATION AND MEDIUM-TERM PROSPECTS January 31, 1972 South America Department CURRENCY EQUIVALENTS Currency Unit - Sol (S/) US$1 = S/38.70 S/1 = US$0.026 S/1,000,000 US$25,840 US$1s000,000 2 S/38,700,000 Above rate applies to some ,5 percent of total foreign exchange tran.actions (largely trade) and is used throughoat this report. There is also a draft marke-. rate of US$1 S/43.38 which covers some 15 percent of foreign exchange transactions. TABLE OF CONTENTS Page MAP BASIC DATA INTRODUCTION SUMMARY AND CONCLUSIONS i I. RECENT DEVELOPMENTS 1 A. Economic Growth 1 B. Investment and Savings 2 C. Credit and Prices 5 D. Balance of Payments 7 II. NATIONAL DEVELOPMENT PLAN 10 A. Introduction 10 B. Overall Objectives 11 C. Economic Sectors and Public Investment 15 D. Agriculture 15 E. Industry 18 F. Fisheries 21 G. Mining and Hydrocarbons 23 III. PUBLIC INVESTMENT AND ITS FINANCING 25 A. Technical Constraints 25 B. Financial Constraints 27 Revenue Prospects 27 Current Expenditures 29 Public Savings 30 Financing of Public Investment 30 IV. BALANCE-OF-PAYMENT PROSPECTS, 1972-74 33 A. Exports 33 B. Imports 34 C. Capital Requirements 35 D. External Debt 38 STATISTICAL APPENDIX This report is based on the findings of an economic mission to Peru in October 1971, composed of Messrs. Michel J. Devaux (Chief of Mission), Roberto Echeverria (General Economist), Surinder K. Malik (General Economisi, Arturo Guzmnan (General Economist) and Mrs. Carmen Martinez (External Debt Specialist). Mr. Ben E. Lehbert (Senior Loan Officer) contributed estimates of domestic and external financing requirements of major projects for 1972-74. . ) ~~E C U A D O R ./ C O L O M B I A/ ' ~ E UA O '..- COLOMBI---- /A-i TUM3ES - X -/ ~ ~~~~~~ , ',~ ! T t *5) IOUITOS/>, ~~~/ / ' O5 )O I* *j*~. Tino 10,0~~~~~~~~~~~~~~~~I- Po,ta Salmon ~~~~~~~~~~~~~~~~~'ONON- ~ -l Poisulano t ! 'HR PiF R A/ , \ <_uo __ kuri~~~~~~~~~~~~u,maguosC MOYOBAMBA .1 HAC HAPOYAS i -C LAYO > oJanji. Pacosmoyo.9 ti ' \>, ,. \ O P p : : ) t o t -I e A B~~~~~~~~~~~~~~~~~~~~~ R A Z I L TRUJILLt sb " XP-reoy TwocheX Pucollpo -K g o Po ncho 8 > / a / A gnoytio > Ch imboni, \ a \gTingo Morio wE )\M _/ ~~~~~~~~~~ ~~Vonohuonco Ooxpon,przo' 7z Poromango CERRO de \Atoloyo Huoch%^ / it ~~~~~Tor,/ In1 ; '^°r7L t *~o Waoy Jo.j /8Ouiotor 06,pi ., HUANCAY0 DM MATUCANA PMANTARO e-rto -SMoldonodo)I Huconaefiowlo Ma \ <@chu 7 \ PisCo ce-4 AYA,UCHO, (icch uzco Pi ~~~~~~~AAcA _ =T |Omb 4 ' t; ~~~~~~~~CHOCLOCOCHA I CA ) loe' sluob,,, j ~~~~~~RIO PAMPAS": : e iun\1' ',:.S {y <,./'Cootop"'/ C~~~~~~~~~Ooto PERU Son' t 'JS r OCONA - CUNO-CUNO --.;: Juliocobf 2 C e Major irrigation projects CA7< ACT 11 Electric power projectsLAJY . _ *f // - LA JZAN~~~~~~~~~~~~~LK Asphalt roads.ov Gravel roads - REQUIPA - ----- Dirt roads .Ds udr La Carretera Marginal ~~ de la Selva MotrOndo, M O E U Railways - MOOUEGUA MOQUFGUA Toqaepala o so5 0 150 200 250 00oon S LOMETERtS TACNA GROUNDWATER 0 ACNA Arico CHILE FEBRUARY 1971 IBRD-160. BASIC DATA Area: 1,280,219 km2 Density per Km2 10.9 Population (mid-1971): 14.0 million Rate of Growth per annum (1961-70) 3.1 percent 1969 1970 1971 Gross National Product. Current Market Prices (Millions of Soles): 198,317 229,026 259,489 Per Capita (US$: market prices) 417 435 446 Real Growth of GNP (percent) 1.4 7.5 5.6 Percent of GNP at Constant 1970 Prices: Gross Investment 13.1 12.9 14.3 Gross National Savings 15.2 14.8 13.8 Resource Gap -4.9 -4.1 -1.7 Factor Income Payments 2.8 2.3 2.2 Net Foreign Capital Inflow (Includes Change in Reserves) -2.1 -1.8 0.5 Central Government Revenues 16.4 16.9 14.6 Gross National Product at Market Prices (1970 Constant Prices- Millions of Soles) 212,988 229,026 241,931 Sectoral Origin (Percent): Agriculture, Forestry and Fishing 17.0 16.9 16.1 Mining 5.8 5.6 5.0 Manufacturing 20.0 20.7 21.4 Construction 3.2 3.4 3.7 Electricity, Gas and Water 1.1 1.1 1.1 Ownership of Dwelling 5.9 5.6 5.6 Public Administration 8.7 8.4 8.8 Other 38.3 38.3 38.3 Money Supply Change in Percent 23.0 50.5 3.0 1969 1970 1971 Price Movement (Change in Percent) GNP Deflator 7.9 7.4 7.2 Cost of Living 6.1 5.0 7.2 Public Sector Finances (Millions of Soles): Central Government Current Revenues 32,565 38,721 37,822 Central Government Current Expenditures 27,868 31,297 33,288 Central Government Current Account Surplus 4,697 7,424 4,534 Balance of Payments (US $ Million) Exports of Goods and Non-factor Services 1,030. 1,196.9 1,076.0 Imports of Goods and Non-factor Services 886.2 952.1 1,054.3 Current Account Balance 24.1 199.5 -80.1 Public Sector Long Term japital (Net) 130.0 100.4 30.5 Private Sector Long Term CapRita_ (Net) -10.1 -80.6 7.3 Errors and Ommissions (Including Short Term Capital) -108.8 25.3 -41e9 Net Change in Reserves (- = Increase) -35.2 -258.9 70.4 Total Reserves at End of Period, Net 152 410 340 Medium and Long Term External Public Debt (US $ Million) Total Outstanding (End of Period) 1,123 1,187 1,113 of which Disbursed 834 874 879 Annual Debt Service (After Refinancing) 142 173 205 Debt Service Ratio (Percent) 13.7 14.5 19.1 Net IMF Position (US $ Killion) November 1971 Quota 123 Net Drawing Outstanding 34. Relationship to Monetary or Custom Area Member of Lafta Member of Andean Common Market SUMMARY AND CONCLUSIONS 1. The main finding of the last IBRD economic report (WH-206a, of March 1971) was that a number of significant improvements in the fields of 'iscal, monetary, and balance-of-payments' management had taken place during the previous two years. This present updating report concludes that the management of the Peruvian economy in 1971 has remained satisfactory. Even with adverse world market conditions for its major export products, and rising imports to feed economic growth, the loss of foreign exchange re- _ serves is likely to be kept to a moderate level (US$70 million, or 17 Dercent of the level existing at the end of 1970). At the ame time, industrial pro-uction has risen sharply, and there are indications of reviving interest on the part of private investors. Public savings, although adversel-N affected by developments in the export sector, have neverthe- less DerTitted an appreciable increase in total public expenditures, especialli in fixed capital formation. While per capita income growth will be limited to about 2 percent, it is likely to be accompanied by a somewhat improved income distribution resulting from the Government's agrarian reform policies and implementation of industrial cormunity legislation. Thus, even if compared with the especially favorable out- come of 1970, 1971 shows considerable achievement. 2. The reduced levels of private investment resulting from the uncertainties associated with the various structural reforms proposed by the Govenlment was a cause of concern in WH-206a. In the subsequent period, legislative action to establish the Government's new industrial policies has been largely completed and the administrative machinery for their implementation set up. The profit opportunities emerging from the strong internal demand persisting since the fall of 1970 appear to have induced some increase of private investment activity in 1971. In order to strengthen this trend and induce private investment of the magnitude essential to the country's growth objectives as set out in the National Development Plan, a continuing pragmatic approach in the implementatbion of industrial policies and provision of incentives would be necessary. 3. On the basis of the preliminary information available in early January, -the level of public investment has been estimated to be around S/. 11.5 billion in 1971, reflecting an increase of some 14 percent in real terms with respect to the previous year. Although this is above the level projected in WH-206a, it is significantly below the initial 1971 budget authorizations for fixed investment expenditures, reflecting the still insufficient capacity of the public sector to prepare and execute high priority investment projects. 4. To achieve an adequate level of public investment, WH-206a recom- mended the adoption of additional tax measures otarting in 1971. Sone new tax measures have been taken. However, an unforeseen shortfall in income tax receipts, resulting from lower copper prices, had to be compensated by domestic borrowing higher than had been projected in WH-206a. This could be done with relative ease since the domestic money and capital markets were very liquid following the repatriation in 1970 of aseeta held abroad. - ii - Drawings from the substantial amount of international reserves thus accu- mulated made it possible in 1971 to compensate for additional credit expan- sion without imposing a contraction in credit to the private sector or ex- cessive inflation. Domesti( prices rose by 7 percent, and net international reserves at the end of 1971 are the equivalent of three and a half months' imports of goods and services. 5. The overall framework of the National Development Plan for 1971- 75 was approved in May 1971, and draft plans for the various economic and social sectors were being discussed at the time of the Bank mission in October 1971. While the overall plan provides a reasonable basis to set in motion the major organizational and investment effort that the Govern- ment's development objectives will require, the mission believes that the yearly investment targets presently being discussed for the various sectors exceed the executing capacity of the responsible agencies, at least for the initial years of the Plan. However, a strong effort is being made by the Government to improve the managerial and technical absorptive capacity of the public sector as a whole. On the basis of the anticipated level of technical absorptive capacity in the coming years, an assessment of the present state of preparation of the most important projects and an all-c- ance for physical delays in the projects requiring major civil works, the mission has estimated investment levels for 1972-74 which are believed to be in line with the potential capability of the public sector for executing investment projects. The revised targets are still on the high side, calling for substantial real annual increases in public fixed investment. 32 percent in 1972, and 26 percent in 1973 and 28 percent in 1974. 6. These investment targets imply financial requirements of the order of S/. 59 billion in the period 1972-74. Achievement of these invest- ment levels would exceed the financial resources likely to be available from the existing tax systems, feasible domestic borrowing and external borrowing in relation to projects, after allowing for a US$100 million reserve draw down. Additional revenue will therefore have to be generated through new tax measures. A number of such measures are under consideration. Their maximum aggregate effect is estimated by the government at S/. 6 billion per arunum, or as much as 18 percent of present tax revenue. The likely yield in the immediate future will depend on the timing and extent to which the various measures are implemented. If the additional revenue is not sufficient. the investment, programrs would have to be curtailed, or additional eternal assistance not related to projects will be needed. It may be that a combination of these measixres will become necessary. On the other hand, if the delay in the execution of the investment program is longer than now envisaged, the unfinanc-ed gap would be correspondingly reduced. Both the prices for copper and fishmeal are expected to remain oelow the 1970 level. Therefore, moderate growth is projected for exports during 1972-7i, while imports are expected to grow by 10 percent p:.a. in real 'terms, in line with the investment program and the expansion in manufacturing activity. Over the period 1972-74 in order to finance the increasing current account deficit ($635 milliol) - resulting from the diminishing trade surplus and the sizeable deficit of the balance of services - and the heavy amortization payment ($483 million), an amcunt of $1,118 million ($370 million, per year on the average) external capital will be needed. The main identifiable sources of financing are: net direct investment mainly related to copper mining and - iii - petroleum exploration ($258 million), and external public borrowing ($668 million). The latter consists of US$274 million disbursements on existing loans and an estimated USM3hL million from new project loans. This level of disbursement on new loans calls for a minimum new lending commitment of about $780 million in 1972-74. This figure compares with the $1,200 million aggregate of the project list presented separately (IBRD, January 25, 1972). Even assuming $100 millio7i draw down on reserves, there still remains an urffinanced gap of about .$90 million. Additional non-project assistance or debt relief could help to close this gap.. Otherwise, the investment program would have to be curtailed. These are ambitious targets and considerable slippages are quite possible. 8. The last Bank report stressed that to assure balance -of-payments' viability in the longer run, investment in Cuajone and in one or more public/ private niining ventures of similar total magnitude should be undertaken in the period 1971-75. Cuajone is going forward, although its financing is presently secured only until the end of 1972. The Government has also signed a contract with a consortium of foreign banks to finance the devel- opment of the Cerro Verde deposit, and is negotiating financial arrangements for Tintaya, on the basis of operating both mines as state enterprises fi- nanced with external borrowing. The total level of these mining investments is somewhat lower than that considered desirable in WH-206a. However, petro- leum developments not visualized in the last Bank report are taking place, and are likely to compensate for reduc,ed mining investment levels. 9. Medium-term prospects do not significantly differ from the ones presented in the last IBRD economic report. The materialization of these prospects depends on further progress being made in the following outstanding issues: (a) the expansion of the absorptive capacity of the public sector in general and of some key sectors in particular (viz, industry, fisheries, and mining); (b) a continued flow of high priority projects and the inflow of adequate external financing to supplement domestic re- source mobilization; (c) adoption of measures needed to alleviate the financial constraint as the absorptive capacity of the public sec- tor is enlarged; (d) adoption of appropriate policies to encourage adequate levels of domestic and foreign private investment in the country; (e) the necessity to continue to hold in check the level of imports of consumer goods to permit the increase in imports of intermediate and capital goods required to meet overall growth targets. IQ. After a hiatus of four years in which few new external loans have been contracted, the pipeline of disbursements is low. Since debt repayment will continue to be heavy through 1974, maximum external aid assistance will be needed to accomplish a positive net transfer of resourceas to the country. I. RECENT DEVELOPMENTS A. Economic Growth 1. Following two years of financial stabilization and economic re- trenchment, the Peruvian economy experienced substantial recovery in 1970 with GDP growing at 7.5 percent in real terms. Exceptionally high prices for two major commodity exports (copper and fishmeal) were responsible for a record level of export earnings. The repatriation of deposits held in foreign currency, by generating a large increase in liquidity, strongly stimulated internal demand. Agriculture recovered from the severe drought of previous years, and public investment increased substautially. Public investment revival was made possible by substantial Central Government cur- rent savings, achieved mainly on account of increased income tax coliection resulting from the copper companies' high profits, and from a change in the collection system for legal persons. Since some of these factors are out- side of government control or cannot be repeated, 1970 should be regarded as an exceptional year for assessing the present trends of economic growth in Peru. 2. For 1971, GNP growth rate is estimated at 5.6 percent (Statistical Appendix Table 2.7). Although more modest than the growth achieved in 1970, and below the National Development Plan target for 1971 (7.5 percent), this rate represents considerable progress in comparison with the one to two per- cent growth experienced in 1968-69, and is higher than the 5 percent growth projected in the earlier Bank report (WH-206a). Satisfactory growth in agri- culture in the face of adverse weather conditions in the first part of the year, and a high level of activity in the manufacturing sector resulti.ng from a continuing strong internal demand for manufacturing, served to offset a reduction in fishing activity, repeated strikes in the mining sector and the decline in prices of major export products. 3. Agricultural output (including livestock) is esLimated to grow by some 2.5 percent in 1971. The meat and livestock component is expected to expand around 5 percent, reflecting strong increases mainly in poultry, pork and dairy cattle. The rice crop is likely to exceed the record 1970 level, and sugar production is expected to continue the strong recovery initiated in that year. However, as a result of diseases and unfavorable climatic conditions, a number of important products, such as wheat, corn, and potatoes are expected to remain stagnant at the 1970 level, while some others, such as beans, coffee and cocoa, are expected to decline. 4. Fishing activity is likely to show a strong decline (13 percent) in 1971. The expansion in fishing for human consumption will not be suffi- cient to offset the decline in anchovy catch (Statistical Appendix Table 7.1). To spread the catch more uniformly over the year, and avoid excessive accumulation of fishmeal stocks prevailing in the earlier part of the year. the permissible catch is being regulated by a system of monthly quotas. Over-fishing and fishmeal accumulation in 1970 will be offset by reduced fishing levels in 1971. 5. Mining production was seriously affected during the first part of the year by repeated strikes. The number of working hours lost because of strikes is estimated to have been 60 percent higher in the first seven months of 1971 than in the corresponding period of the previous year. Iron ore production for the first eight. months of the year is about 22 percent below last year's production. Non-metallic mining production has also been affected but to a lesser extent. Petroleum production has been declining as a result of a reduction in the yields of existing wells. The Government is conscious of the negative effects of continuing labor unrest and is presently reviewing its labor policy. Two Decrees have already been issued by the Government in November/December 1971 by which negotiated wage increases in all sectors, including mining, would remain operative for a minimum period of two years, thus contributing to wage stability. By exploiting the richest part of the mines some recuperation in the last part of the year- will permit the overall mining production not to decline by more than 6 percent. 6. Production in manufacturing industry is likely to expand by >.j percent in 1971 (Statistical Appendix Table 7.2). Almost all branches of manufacturing have benefited from the strong internal demand persisting since the last quarter of 1970. Excluding fishmeal processing and refining of base metals, the growth rate for manufacturing is likely to reach 14.5 percent in 1971 (against 11 percent in 1970). B. Investment and Savings 7. Gross domestic investment in 1971 is estimated to have increased in real terms by 17 percent over 1970, reaching S/.37.3 billion (Statistical Appendix Tables 2.1 and 2.2). Both the coTmmodity producing sectors and infrastructure have shared. in this increase. Vigorous growth in manufactur- ing production since the fall of 1970 appears to have induced some revival in investment activity, in addition to a more intensive use of existing equipment. The mandatory reinvestment in the same firms of 15 percent of net profits provided by the General Law of Industries has resulted in expansion of the installed, capacity and some modernization in a number of plants. However, despite the threefold increase in the authorizations for constitution of new industrial firms in the first nine months of 1971 over the whole of 1970, no majcir new industrial plants have been reported. New private investment seems to have been mainly concentrated in textiles, food and beverage industry, and. also in construction. 8. Preliminary information available in January 1972 indicates that public investment could be of the order of S/.12.3 billion in 1971 (or 11.5 billion in 1970 soles). This represents in real terms a 14. percent increase over the 1970 level. While this level is below the S/.17 billion initially budgeted, it compares well with the S/.10.4 billion (1970 soles) level projected in the last IBRD economic report.A/ 1/ WH206a projected S/.9.6 billion of fixed investment for 1970.. However, this did not include S/.0,8 billion invested by local governments, for which data was not available at the time. - 3 - 9. Preliminary estimates suggest that gross domestic savings declined in 1971, reflecting primarily the deterioration in the export sector. Most of the decline in, savings appear to have been concentrated in the pubii secstoir_. 10. The decline in public sector savings is a result of two factors: (a) Central Government revenues, after the extraordinary inWrease inYtho previous year, are likely to fall by about_3 percent in 1971, mainly because of a decline in income tax revenue reflecting a reduction in the taxable income of copper companies. Since the companies account for more thai- 50 percent of total income tax received, a decline in copper prices and higher production costs IEVe a direct impact on income tax revenue; however, some of this decline can also be explained by the modification of the tax collection system for corporations which had been changed in 1970 to a pay-as-you-go basis, with the result that a part of the very large 1970 collection was of a non- recurring nature. In contrast to the income tax, revenues from taxes on production and consumption and from import duties rose smartly (see table below). (b) Central Government current expenditures are expected to grow moderately. The main increase in expenditures is likely to come from wages and salaries expected to grow by 17 percent after three years of freeze, and from a 45 percent increase in debt interest payments. Military outlays and purchase of goods and services are likely to remain unchanged at the 1970 level, and current transfers to public institutions and state enterprises are expected to decline by 20 percent. - 4 - Central Government Operations (billions of soles) 1969 1970 1971 Estimate /1 Current Revenue 32.6 38.7 37.8 Taxes from income, property, and export 10.8 14.0 10.6 Production and consumption tax 10.9 12.1 13.1 Import duty 7.7 7.9 9.0 Other taxes - - .5 Non-taxes, revenues and transfers 3.1 4.8 4.7 Current Expenditures 27.9 31.3 33.3 Wages and Salaries 12.5 13.8 16.1 Purchase of goods and services 1.5 1.9 1.9 Interest payments 1.7 2.0 2.9 Current transfers 5.4 6.5 5.2 Military outlays 6.8 7.1 7.2 Current Savings 4-7 7.4 4.5 Capital Income - - - Capital Expenditures 6.3 8.2 10.0 - gross fixed capital formation 2.9 4.2 5.2 - financial investment 0.2 .5 .4 - capital transfers 3.2 3.4 4.4 Overall Deficit (-) -1.6 - .8 -5.5 /1 Estimated on the basis of actuals for the first nine months. Source: Ministry of Finance and mission estimates (Statistical Appendix Table 5.1). 11. The net effect of these factors has been a reduction in the current account surplus from the extraordinary level of S/.7.4 billion in 1970 and the projection in WH206a of S/.8.8 billion for 197 Q/ to an estimated 1971 actual of S/.4.5 billion. This level, together with the savings in the rest of the public sector, was not sufficient to finance the levels of investment that the Government had intended for 1971. On the other hand, the expansionary effects of government financial policy in 1971 have served to mitigate the depressing impact on the economny of unfavorable export developments. The fiscal management was such that the Government deficit was kept within limits which could be adequately financed. C. Credit and Prices 12. The Government did not have difficulty in borrowing domestically the needed amounts, without curtailing availability of funds to the commodity producing sectors. Net public sector borrowing amounted to S/.4.6 billion. Most of the borrowing was from the banking system; the latter was highly liquid, partly as a result of the 1970 repatriation of funds from abroad, and could accommodate the demands of both the public and the private sectors. Credit expansion to the private sector in 1971 amounted to 19.5 percent in nominal terms (12 percent in real terms). Money supply remained practically unchanged, as a result of the large shift from demand to savings and terms deposits. (A large part of the foreign exchange holdings repatriated in 1970, which initially wmnt into demand deposits, gradually shifted into savings accounts and other forms of term deposits.) The loss of foreign exo-hange reserves amounted to US$70 million, with gross reserves amounting to $452 million at the end of 1971 (or $340 million of net reserves). The increase in the price level during the year was 7 percent, similar to the preceding year. 1/ S/.8.2 billion in 1970 prices. - 6 - SUMMAYE OF THE BANKING SYSTEM (In billion soles) Dec. Dec. Dec. 1969 1970 1971 Foreign Exchange Reserves (Net) 5.9 15.9 13.1 Domestic Credit (Net) 37.2 43.2 50.6 Public Sector (Net) 11.6 11.1 15.7 Central Government (12.6) (12.1) (19.5) Rest of Public Sector (-1.0) (-1.0) (-3.7) Private (Net) 34.3 39.9 47.7 Official Capital 10.9 12.8 14.4 Other Unclassified Assets 2.2 5.1 1.6 Long Term Liabilities to International Institutions 1.1 1.1 1.0 Liability to Private Sector 41.9 58.o 62.7 Money 23.6 35.5 36.5 Currency (11.8) (16.3) (18.8) Demand Deposit (11.8) (19.2) (17.7) Quasi-Money 8.3 22.5 24.4 Term Deposit ( 3.8) ( 6.6) ( 6.7) Savings Deposit ( 7.6) ( 7.9) ( 8.9) Deposits in Foreign Currency ( 3.4) ( .3) ( 0.1) Foreign Exchange Certific:ate; ( - ) ( .1) ( 0.1) Mortgage Bonds ( 2.2) ( 5.1) ( 7.1) Other ( *4) ( 1.2) ( 1.4) Other Mortgage Liabilities ( .9) ( 1.4) ( 1.7) Source: Statistical Appendix Table 6.3 and mission projections. - 7 - D. Balance of Payments 13. Balance of payment results during 1971 were dominated by un- favorable export earnings caused by a decline in export volumes and lower coriAnodity prices. Merchandise exports are expected to be 12 percent lower than in 1970, largely as a result of a 20 percent drop in copper pricesa/ an; a general decline in the price of all other minerals and fishmeal (see Statistical Appendix Table 3.3). In addition, strikes in mining have reduced the volume available for exports of various minerals: iron ore exports are likely to decline by about 12 percent, and the volume of lead, silver and zinc exports irll also experience reductions. The volume of copper exports (as distinct from production) is likely to be more or less at the 1970 level, since the possibility of a continued price weakness in 1972 has led companies to draw on their copper stocks. This has not been tVe case w.rith other nonferrous minerals for which price expectations have bnecn more encouraging. ih. The vrolume of fishmeal exports in 1971 is likely to decline by ;onout 10 percent, since the high fishmeal price reached at the end of 1970 encPo1.rag=d soybean substitution. The problem was compounded by the attemp-t o. the recently established state marketing agency to maintain prices, in the face of falling demand, at the previous year' exceptionally high levels. The resu'.t was accumulation of large perishable stocks and an ultimate sharp price reduction, affecting adversely the value of exports for 1971 as a whole, and generating sharp liquidity crisis in the industry. Since the .iiddle of 1971, the marketing policy has been more flexible as well as suiccessful. In addition, EPCHAP (the government fishmeal marketing company) has engaged in a promotional export campaign towards new markets including IJSSP and t.he People's Repnblic of China with whom sales contracts havto lateiy bee.n signed. 15. Other agricultural exports are expected to decline or i'emain unchanged. Exportable surpluses of cotton vill decline because of increased domestic consumption. The price of coffee has fallen in 1971, and the vol- ume of wool exports has stagnated. The price of sugar has strengthened, and the 7olumne of exports remA.inAd unchanged at the high 1970 level.. 16. Merchandise imports in 1971 are likely to be around 12 to 14 per- cent higher than in 1970. Most of the additional imports have gone to productive activities. Stimulated by strong activity in the manufacturing industry, imports of industrial raw materials are likely to show an increase of about 21 percent and imports of capital goods for industry and agriculture will grow by 8 percent. Conversely, consumer goods imports are likely to remain stationary at the level of 1970. The food component is expected to increase by 6 percent. 1/ From US$0.525 f.o.b. Peru per poiuwd in 1970 to US$0.416 per pound in 3.971. -8 - 17. The trade surplus is likely to be reduced from US$346 million in 1970 to about US$130 Inillion in 1971. The balance of services for 1971 is expected to be more or less identical to that in 1970, except for an increase in interest paynents. Transfer receipts, abnormally high in 1970 because of the earthquake, are likely to be back to their normal level. Therefore, balance on current account will show a deficit of around US$80 million in 1971, as against a surplus of US$200 million in 1970. The earlier IBRD report, WH206a, projected a deficit of US$121 million for 1971, mainly on account of higher levels of imports related to copper mining development, which has been somewhat delayed. Stmmary of Balance of Payments (US$ millions) 1969 1970 1971 Exports of Goods and Non-factor Services 1,030.5 1,196.2 1,076.0 Importsof Goods and Non-factor Services 886.2 952.1 1,054.3 Resource Balance 144.3 244.8 21.7 Net Factor Income Payments -151.6 -135.5 -141.1 - Interest on Public Debt - 45.4 - 50.7 - 57.0 - Other -106.2 - 84.8 - 84.1 Transfers (net) 31.3 90.2 39.1 Balance on Current Accourt 24.1 199.5 - 80.3 Private Capital - 10.1 - 80.6* 7.3 Public Capital 130.0 100.4 30.5 - Disbursement 224.5 154.7 179.1 - Amortization - 94.5 -125.5 148.6 - Nationalizations - 71.2 - SDR Allocation - 14.3 13.8 Errors and Omissions -108.8 19.1 hl.0 (including short-term capital) Change in Reserves (- increase) - 35.2 -252.7 70.4 * Includes $71.2 million of nationalizations. Source: Statistical Appendix Tables 3.1 and 3.2. - 9 - 18. The delays in mining investment will also be reflected in a smaller than projected inflow of private capital in 1971, while net official capital inflow has remained negligible. The overall result of current and capital account transactions, a reserve loss of US$70 million, will leave the level of net international reserves at the end of 1971 at around US$340 million, equivalent to three and a half months of imports of goods and services. II. N5ATIONAL DEVELOPMENT PLAN A. Introduction 19. After an initial period of political and economic consolidation, the Peruvian Government regards the next few years as a period of substan- t,ial re-vival pf_the __coq9my_lft k edc a in the socT and economic s tructur,e of Lhse_pnntry. The Xintial_Btep has been the formula on_ l-eg islation enabling the various structural changes in the major productive sectors to take place (agrarian refornm law, general law of industries, law of_indus-trial_community, general law of fisheries, and general la-w oT -rdining). 20. In lay2 1971, the Peruvian Government approved a National Develop- ment Plan for 1971--75 which Gf-e overnment's 'thrust t6solv i-ng the most important economic and social problems of the coun- try and to provide the overall framework within whiclh re-fonal and sectorial plans will be devised. At the time of preparation of the last Bank report (Wi-206a), the National Development Plan for 1971-75 was in the process of being formulated. WH-206a presented an indicative investment program for 1970-72 based on provisional investment proposals for 1971-75 made by the National Institute of Planning. Although several revisions of the project content and overall investment: levels have been subsequently made, the sec- torial objectives and priorities have remained to a large extent as indica- ted in WH-206a. 21. The GovernDent views the process of development not only as the achievement of prosperity wvithin the existing social order, but basically as a process of transformation of the economic and social structure of the country to eliminate injustices and inequalities. The policies and programs of the Plan are thus heav,ily influenced by this concept of development, and the Plan as a whole is viewed mainly as a catalyst for various reforms through which the Government twould att:ewmpt to achieve a more integrated and equita- ble society. The goals of the Plnuln therefore, are considered essentially as targets, giving quani ti-atiVe expression to the Govrerrnient's development intentions. Individual plans for all the economic and social sector have been prepared, providmng a breakdown of the sectoral targets into specific technical investment programs. The reconciliation of these goals with day- to-day reality will be arhieved through short-term overall and sectoral plans, which will dJeterA.'.Ie c.uStments and corrections in the -long-term targets. These shorrt-rn pl-vi3 1f-li be closely linked to the Biennial -idgets, transforming the Covernment's development intentions into concrete expenditure authori_-,ations,. The first Biennial Plan (covering the years 1971 and 1972 and coincidjent iith the first Biernial Budget) is already in operation and quarterly evalua.tions of the progress in current and capital expenditures of the publir sector are being performed and will permit short- run adjustments in the Pian.. The overall budgetary allocations for 1972 have been already reprograrm ed. and adjusted on the basis of the experience gained in the first three q.uarterly evaluations of 1971. The sectoral dis- tribution of the reprogralmecl budget is presently taking place and will provide an opportunity for definirng even further the short run investment targets. - 11 - 22. In the view of the Mission, the success of the planning mechanism will depend on the extent to which the short run government actions wTill adequately reflect the 1971-75 National Development Plan's objectives and priorities, and avoid distortions in the sectoral policies and investment levels. Otherwise, the achievement of the stated medium run goals might be jeopardized. B. Overall Objectives 23. The basic structural problems that the Plan attempts to face are: the acute contrast in the distribution of personal income and of the oppor- tunities for benefitting from the output generated by the society as a whole; and the low productivity and lack of integration of the various economic activities which prevents an effective use of the human and natural resources of the country. 24. A set of explicit medium-run objectives tending to correct these basically long-run problems constitutes the development strategy of the Plan. (Please see Chapter I - of the National Development Plan, separately distributed.) Among these objectives, the more important ones are: (a) the strengthening of the public sector as the principal agent of development, modernizing public administration and using planning techniques as instruments of govorn- ment; (b) to stimulate private sector participation in productive and financial activities not reserved for the State. (c) to promote substantial increases in production and pro- ductivity in agriculture, industry, fisheries, and mining. Development of the transport and power sectors will be geared to the requirements of those productive sectors; (d) to promote the development of cooperatives and other associative forms as a way of effectively increasing economic and social participation of the population; (e) to accelerate and complete the process of agrarian re- form throughout the country; (f) to promote a substantial increase in productive employ- ment opportunities; (g) to develop scientific and technological research tending toward imnroved utilization of the productive resources of the country; (h) to improve substantially the education and health levels of the population. - 12 - 25. These objectives have been translated into quantitative targets to be reached in the mid :1970's regarding output, investment, employment and price level. A suxmmary is presented below: - 13 - Output: Structure Growth Structure 1970 1971-75 1975 1. Agriculture 14.5 4.2 12.4 2. Industry 20.9 12.4 26.0 3. Fisheries 2.1 4.8 1.9 4. Mining 6.8 5.7 6.3 Other 55.7 6.6 53.3 Total 100.0 7.5 100.0 Investment: Structure Growth Structure 1960-67 1971-75 1971-75 Gross Domestic Investment 18.9 Private Investment 9.6 Public Investment 32.0 Agriculture 8.0 7.6 Industry 14.2 25.1 Fisheries nil. 4.2 Mining nil. 16.4 Transport 30.2 16.4 Other 47.6 30.3 Total 100.0 100.0 Employment: 1970 1975 Economically Active Population (millions) 4.3 5.1 of which employed 3.1 4.2 deficit of employment 1.2 0.9 Employed in Agriculture 1.3 1.6 Employed in Manufacturing 0.2 0.3 Employed in Handicrafts 0.4 0.6 Price Level 1965-70 1971-75 Annual Growth 11.9% 7.2% Labor Productivity Annual Growth 3.5% - 14 - 26. In general, the 15l71-75 National Development Plan, and the planning mechanisms adopted by the Government, are marked by pragmatism and provide a reasonable basis for launching the major investment effort that the economic and social programs will require. In contrast with previous planning efforts, the Government has made a political commitment to carry out the major elements of the Plan, and the required administrative machinery for mobilizing the necessary human and financial resouxces is being set up. The responsibility for the improvement in the administrative machinery has been given to the Institute of Planning in an effort to ensure coordination between the formulation and the execution of the plan. Besides, the Institute of Planning is presently conducting, with some technical assistance from bilateral and multilateral sources, a research program aimed at improving the planning methodology. Technical cooperation is being coordinated by the Institute of Planning, and progress is being made in the preparation of a National Program for Technical Assistance. The mission believes that it is essential that this program reflects as closely as possible the specific technical assistance needs emerging from the National Development Plan, and should have high priority if administrative bottlenecks in some important sectors are to be removed. There is still, however, considerable scope for further strengthening of the planning mechanism, specially at the sectoral level. Standards for project analysis vary greatly between the various executing agencies, affecting the proper establishment of economic priorities.. This is a key element for assuring a steady flow of projects of demonstrated high priority to sustain a long-term investment program. In some important policy areas, such as income distribution and employment, statistical data as well as the coordination of the various sources generat- ing these data would need to be improved. Also, additional improvements are needed in the channels of communication between the Central Government and the various executing agencies. Knowledge about the operations of decentralized agencies is in some cases insufficient, limiting the effective- ness of overall planning and of the management of public financial resources. 27. As pointed out in WH206a, even if substantial increases in public investment could be effected, it is unlikely that over the short and medium-term this expansion would adequately compensate for a continuing low level of private investment. The major investment effort required to meet the production and employment objectives of the National Development Plan calls for joint and complementary effort of both the public and private sectors. This is accepted by the Government and its economic projections assume the continuation of an adequate role for the private sector in aggregate investmernt. While there seems to be growing accept- ance on the part of the private sector of the Government's new set of policies and regulations aimed at achieving basic structural changes in the productive sectors of the econorny, uncertainties persist in regard to the stability of these policies. Profit opportunities arising from increased internal demand are beginning to provide incentives for higher private investment; the Government appears to be following a flexible and pragmatic policy in the administration of the new agrarian, mining and industrial legislation, and the mission believes that every effort should be made to build upon theise and other incentives to assure an adequate response from private domestic and foreign investors. - 15 - C. Economic Sectors and Public Investment!" 28. The salient feature of the Plan is the increasing participation of the public sector in economic activity, to be reflected principally in the level and composition of public expenditures. Total public expenditure (current and capital) are projected to rise from about 19 percent of GDP in 1970 to over 26 percent in 1975, mainly because of a substantial increase in gross public capital formation, which is projected in the Plan to grow at an average of 32 percent per year. Most of this dynamism is expected to come from public enterprises, especially in the industrial, mining, and energy sectors. At the same time, private investment is projected to in- crease at a relatively slower pace, at about 10 percent per year through 1971-75. The result will be an increase from one-third to over one-half in the share of public investment in total gross fixed investment. However, the soundness of the overall investment effort can only be determined through an analysis of its sectoral composition and the degree to which individual technical programs of investment within each sector address themselves to solving the major problems of development in each sector. A brief analysis of selected important sectors - agriculture, industry, fisheries, mining and hydrocarbons - is presented below. The sectors account for 45 percent of total planned public investment for the next three years. D. Agriculture 29. Public investment in agriculture is expected to reach around S/.1.7 billion in 1971 (only slightly above the level projected for Agriculture and Irrigation in WH-206a), representing 14.7 percent of total public investment. Although it is projected to grow quickly to almost double this level by 1974, its share is likely to decline as a result of faster growth of public investment in other sectors. The Ministry of Agriculture - the basic executing agency for public investment in this sector - seems able, on the basis of past experience and its present availability of technical personnel, to handle these levels of invest- ment. 30. A major obstacle to agricultural development is the difficult topographic and climatic conditions, which make irrigation and transport infrastructure indispensable for expanding the present agricultural area. Over 60 percent of planned public investment in agriculture will be there- fore made in the Water and Irrigation Program, of which the most important 1/ On the basis of data available in January, revised estimates of public investment have been incorporated in the text of the report (see page 26 ). However, due to the short time available and the still provisional character of those data, it has not been possible to revise the supporting tables in the statistical appendix and therefore some discrepancies remain. - 16 - projects will be Tinajones, Chira-Piura, Majes-Siguas, Small and Medium Irrigations, and the Application of the General Law of Waters (Statistical Appendix Table 5.3). The second major constraint in the sector emerges from having a large proportion of the rural population engaged in sub- sistence agriculture with very limited production and consumption relations with the rest of the economly. To integrate rural population into the market economy, and to improvre income distribution in agriculture, the Government has therefore embarked on an agrarian reform program involving land redistri- bution and settlement, technical and financial assistance, improved inputs, marketing and irrigation facilities, and agricultural research (for details see paras. 26-32 in IH206a). Investment on the Agrarian Reform and Rural Settlement Program (9 percent of total agricultural investment through 19Th) will be mainly for colonization and settlement of the high Selva and the integral development plans for a number of other agricultural zones. Most of the investment expenditures directly related to agrarian reform are in the Program of Promotion, which includes livestock development in the Selva, agricultural development of Jaen-San Ignacio, and agricultural machinery pools. 31. The major impact of agrarian reform is not expected to come from increased public investment expenditures. Production cooperatives and SAIS (Agricultural Societies of Social Interest) are expected, as far as possible, to maintain the original production methods and thus do not require immediate public investment outlays. However, the qualitative change in the productive structure resulting from a redistribution of land, the organization of production in cooperative farms, and the intensification of agricultural production through the use of improved inputs, is intended to have income and employment effects that extend beyond the agricultural sector. The expansion projected for manufacturing industry is partly based on the assuiption of an enlarged domestic market resulting from higher and better distributed agricultural incomes. Besides, agriculture, which presently provides employment for almost half of the active population of the country, is expected to generate a substantial part of the increase in productive jobs projected by the plan, reducing the pressure of migration to urban areas. This is being sought through technical assistance and the promotion of labor-intensive agricultural and livestock products such as poultry, pork, and vegetables. 32. As provided by the Agricultural Development Plan for 1971-75, the whole country must be incorporated in agrarian reform zones by December 1972, and the process of expropriation and redistribution of land should be completed by 1975. At present, only 15 percent of the country remains to be included in agrarian reform zones. Once included in an agrarian reform zone, al1 properties exceecling the maximum permissible size or its equiva- lent (150 has. of irrigatecd land in the Coast, with correspondingly higher limits for dry farm and pasture land) as well as those which do not fulfill certain specific social ancd economic criteria, are subject to expropriation. In order to avoid a prolonged state of uncertainty on individual farmers, the Government has decided to speed up at maximum the process of affectation of farm land. The target is to decide by end 1972 which properties are subject to expropriation in those agricultural areas that have priority on account of demographic pressures, concentration of wealth, social tensions and high volume of procluction. - 17 - 33. Expropriation and redistribution of large farms do not appear so far to have adversely affected overall agricultural production. Prior to 1971, most of the advance in agrarian reform was on account of the expro- priation of the large sugar estates in the Coastl/ and some large livestock ranches in the Sierra. In most of these cases, the former production and management structure has been preserved, and the level of production has generally increased. However, in some cases of expropriation elsewhere, delays in setting up production cooperatives have resulted in retarded planting and cultivation, with consequent reductions in yields. 34. Uncertainty regarding the scope of agrarian reform and the stability of the upper farm-size limit is likely to have negatively affected the decisions for medium- and long-term private farm investments, even in those commercial farms that fall below the maximum permissible area. The scarcity of medium- and long-term bank credit is also likely to have inhibited private farmers' decisions to invest. The Government has given repeated assurances that the "rules of the game" will not be modified, and a number of farms have been found meeting the requirements of agrarian refoni and declared unaffectable. While these factors and the passage of time are likely to improve individual farmer's investment attitude, the Government is relying on production cooperatives as the major source of future agricultural capitalization. In order to attain this objective the general law of cooperatives compelled them to reinvest a certain proportion of net profits. 35. In the short-run the major issue facing the agricultural sector is the required expansion in output to meet the growing demand for food derived from the increase of population and the redistribution of incomes, and to reduce or at least avoid further increases in the present high deficit in the agricultural balance of trade, at least until satisfactory complementary trading arrangements can be made with other members of the Andean Community. With the exception of wheat, other major deficit pro- ducts -- beef, milk and derivatives, and vegetable oils -- could be produced domestically; their expansion has been, however, hampered by a lack of price-cost incentives and proper marketing channels. 1/ The 20 former sugar estates (expropriated in June 1969, two days after the Agrarian Reform Law became effective) have been consolidated into 11 agro-industrial complexes, operating as production cooperatives covering a total area of over 400,000 has. and with a total population of about 180,000 persons. About 90,000 has. are planted with sugar cane (producing about 95 percent of the country's sugar production), 200,000 has.are used in food crops and livestock, and the rest is not fit for agricultural use. - 18 - 36. WH-206a stressed the importance of this problem, and recommended an agricultural program that would concentrate Government efforts on expand- ing the production of major deficit commodities (including staple grains that could partly substitute for wheat). (See WH-206a paragraphs 23 to 25.) The new National Development Plan addresses itself to such a program, and also contemplates specific policy measures regarding price levels, improved inputs, credit and marketing facilities and research. 37. Some concrete steps have already been taken. A limitation of beef imports and the introduction of two meatless days every week have generated a large increase in the production of substitutes like poultry and pork. An educational and marketing campaign is under way to increase consumption of seafood. The Government has assumed control of the marketing of wheat, pro- hibiting its use for nonhuman consumption purposes. The investment program proposes the provision of physical facilities for providing improved inputs and aims to create production and consumption cooperatives to facilitate the marketing of agricultural products and the purchase of inputs. 38. However, distortions in the price relations of products and inputs identified in the last Bank report (see WH206a, paragraphs 36-37) are still prevailing. The pricing of beef, milk and edible oils continues being approached mainly from an urban-consumer point of view, discouraging ex- pansion of production and the use of improved inputs to increase productivity. However the Government has its pricing policy for agriculture presently under review. 39. It is of the highest importance that a set of policies such as those recommended in WH-206a - and which form part of the agricultural policy objectives of the National Development Plan - be quiclcly adopted. Otherwise, it will be difficult to prevent a further deterioration in the agricultural trade balance, jeopardizing the financial viability of the investment program. E. Industry I/ 40. As mentioned in WH-206a, the most important obstacle to the devel- opment of the industrial sector has been the limited size of both dEst±c and external markets. Domesti fdemandfor maufactured products has come a-iny-ftrom medium- and high-income urban consumers, which do not constitute a market large enough to permit the efficient operation of industries sen- sitive to economies of scale. On the other hand, high levels of effective protection and widespread fiscal exemptions granted indiscriminately under the previous Industrial Prom tT5h Law have not encouragedtprodUI2tve efficiency and have priced petAviTIEnGEuEXictur&i products out of competition in foreign markets. 1/ Refers only to industries under the administrative jurisdiction of the Ministry of Industries. Thus, excludes fishmeal industry, basic petro- chemicals, coal and metal refinery. - 19 - 41. Despite a steads growth in thv rn 96', the lack of any efct-- ive industrial planning generated a number of undesirable features in the industrial structure (for historical analysis of thle industrial sector, see paras. 45 to 47 in WH-206a). In response to the concentration of demand .mnd the high density of economic infrastructure in the zone of Lima-Callao, in- dustrial plants were located mainly in this area with little employment and/ income effects in other parts of the country. Manufacturing output was mainly geared to the substitution of imported final consumer goods with a high_import~j component, to the disregard of manufacture of capital goods. Industria]TFtchhology, even for the production of consumer goods, has been capital intensive, with the absorption of labor force in the 196O's growtngt at less than half the growth of manufacturing. 1 42. Within the industrial sector, state participation has been minimal: less than 2.4 percent of industrial GDP was contributed by public enterprXeB:s (basically steel production) in 1968. The Government's strategy for indus- trial development is now based on substantial and direct state participatbon in industrial production through state enterprises or mixed ventures with domestic or foreign private capital (see paras. 49 and 50 in WH-206a), snd on an enlargement of domestic and external markets for manufactured products. Peru's participation in regional integration efforts (Andean F-nA) will be strongly emphasized, especially in heavier indu8tries that require larger markets. At the same time, an effort winl be made to rationalize and increase efficiency in those productive activities that will face strong competition from the enlarged market. 43. The Government intends to act as a catalyst for increased private investment by promoting joint ventures -ith private investors a b o- vidfng incentives tor re mnve s mnt o rofits in vta pnisesitor. -The major thrust in the medium term will be to orient industrial invotment toward the manufacture of capital and intermediate goods, and toqincrease the utilization of installed capacity in consumer goods. The general law of industries issued in July 1970 (see WH206a, paragraph 49) assigns the highest priority to industries producing capital goods and basic inputs for directly productive activities. While basic industries are reserved for state operation or for private participation under contract in special cases, the rest is envisaged as privately operated or as joint public/ private ventures. Incentives for private investment include various fiscal exonerations on the reinvestment of profits, and on import duties. Further incentives, m se grant for 1 beralized grAdiL terms from the state developent banks and from regional private banks, o taxexonoa of the Lima-Callao area, and preferential support from the public-sector with respect to industrial infrastructure, marketing of products and inputs, and technical assistance. The State Industrial Bank is curr ntly bein reoriented to ass mall industry and handicrafts While the recently created state Development Finance Co E will be in charge of mobilizing and channeling both local and foreign capital ±nto larger ublc and rivets industrial projects. The more important physical targets to be achiev rE nc sed public investment and reorientation and regulatin of private investment are as follows, as envisaged in the 1971-75 National Development Plan: - 20 - Rate of Growth 1965-68 1971-75 Industries producing mainly: Consumer goods 4.2 8.1 Intermediate goods 2.4 14.4 Capital goods 9.7 15.6 Share in Industrial GDP 1970 1975 Consumer goods 58.5 50.o Intermediate goods 26.8 31.0 Capital goods 14.8 18.1 44. Public investment in indust is, however, likely to be relatively small I I yabo 3 ercent of total public fixed invest Table on page 26 ). This has takenmainly the form of studifor promotion and future implementation of private and public investment in Industrial projects. In the coming years, the Government will concentrate its effort in basic industry, especially steel coniiex shemistry, which are also6exp-ected to have st6r6ngf f-orThE 1 oMthe-ba±ance of payments. Almost 40 percent of the total cost of ndustrial public investmenti/ through 1974 is accounted for by steel d metal working industries (Statis- tical Appendix Table 5.4). The increase in s l uioi permit the development of those metal-working industrial branches producing machinery and equipment required for the expansion of mining, agriculture; fisheries, and energy. Besides steel and metal-working industries, the other important component of public investment - covering about one-fourth of total invest- ment in the period -- will be chemical and petrochemical industries. A comuplex for i ndustrialiation of sugar cane bagazeapulp and paperemill, ai a _opper_r_llng_End_ xArusion plant are also planned. 45. In the medium run the absorption of labor force by the industrial sector will be relatively low as a result of the priority given to basic industry which is capital intensive. However, support is also being given to production and exports of handicrafts to generate some additional employ- ment. 46. Through 1974, public industrial investment is expected to exceed S/. 8 billion, with substantially higher levels envisaged for later years. The Government's plan for public investment in industr is erhaps the most important element ts deI-opnnt p-rogr-a-ms - es the bic;s ral change it would attempt in the sector, thep gram implies setting up adequate technical and administrative machinery in a sector where little previous experience exists. An effort toward this end is on the way. The Ministry of Industry has been reorganized, project preparation and evaluation units are being set up, prefeasibility and feasibility studies are being 1/ Including public sector's direct investment as well as its contribution in mixed enterprises. - 21 - contracted and investment proposals from private parties for the formation of enterprises invited. However, this process takes time, and substantial delays have already taken place in the original public investmcnt targets. Further strengthening of the planning process at the sectorai level, to speed up project preparation and improve their execution, should receive high priority in the allocation of human and financial resources. F. Fisheries 47. The fisheries sector has been one of Peru's most dynamic produc- tion activities in the recent past (for details, see WH206A. paragraphs 5hIqi1.Ljhowever, its growth was not properly regulated, resulting in an imbalance of production that is presently limiting the full use of avail- able natural resources and further expansion of the sector. 48. While fishing for the production of fishmeal and fish oil ex- panded very rapidly (annual average growth of 11 percent between 1965 and 1970) to make Peru the largest fishmeal exporting country in the world, fish Ion has remained ractically St gafC.Thus, in 1970, 98.5 percent otetotal fish catch was for fishmeal and fish oil production, while the remaining 1.5 percent was divided into fishing for fresh consumption, fish preserves, and frozen and salted fish. 49. The lack of proper regulation in a sector where there are significant technological external diseconomies has led to large excess capacity and poor geogrAphThal location of the processing plints (too large concentration in the area of Callao). There are large numbers of process- irni pDlant of _ eouwLalsizne; relatively high co7Ua!WEM ::or ownesip; high costs of marketing due to inadequate facilities for packing and shipping of fishmeal; and poor training of technical personnel. The overall financial position of the sector has remained weak. Nevertheless, the establishment of' few larger, modern and efficient enterprises -- which today aciouEnt for a substantial part of total output -- has cont-rtBute-d to te overall prosperlty enjoyW by lor, and has pelTrxrzLLd th-e acnievwument of a reasona~blyhigh average level of technology and productive efficiency. 50. This contrasts markedly with an almost totally craftsman-based structure in fishing for direct consumption, with improper_fishing boats, unskilled labor, and practically non-existent infrastructure. 51. A number of improvements are still possible in industrial fishing referring mainly to cost-reducing modernization of the catching and pro- cessing infrastructure. However, since the level of anchovyz catch -- fixed presently by the Government at 10 million M.T. per year -- is close to the biological maximum permissible f the specie is to be preserved, frther growth of the fishing sector has to be based on a substRantal increase or IVrnin oe for direct human consumption, be it domestic or for export. - 22 - 52. The Goverrment's fisheries plan is based on substantial state participation in infrastructure investment and marketing through the recently created Ministry of Fisheries, the Public Enterprise for the Marketing of Fishmeal and Fish Oil (EPCHAP), and the Public Enterprise for Fisheries Services (EPSEP). 53. While industrial fishing and procetssng are_to continue as private enterprises under government policy guidelines, the Government has iissuiied to6taJ?control o mTFetinL of l1shmeal and fishoil. High priority in publitpol-tytin and investment is now being given to the development of fishing for direct human consumption. 54. Public investment in fisheries is expected to be relatively low in 1971 (about 1 percen-t of total public investment) as the studies required for the implementation of the various projects are being completed. How- ever, from 1972 to 1974, public investment in fisheries is projected to expand substantially, increasing the share of the fisheries sector to about 8 percent of total public investment. 55. Of a program of public investment in fisheries with a total cost of over S/.5 billion through 1974, about three-fourths are earmarked for increasing production and marketing facilities in fishing for direct human consumption (Statistical Appendix Table 5.5). This investment, complemented with a private investment of some S/.2.5 billion, is expected to generate a threefold increase by 1975 in the total catch of fish for direct human consumption (from 210,000 M.T. in 1971 to 600,000 M.T. in 1975, of which 180,000 M.T. should correspond to the public sector). The Government's further development in the fisheries sector is aimed at making further use of the apparently large fishing potential of the Peruvian Sea. Recent studies made by Japanese and Russian research vessels have provided pre- liminary evidence of this potential, identifying significant quantities of hake (merluza), shrimp, and other species suitable for human consumption. Studies assessing the feasibility of projects of fishing for human con- sumption are well advanced and should provide in a short time additional evidence regarding the fishing potential as well as domestic and foreign market possibilities. Nevertheless, the targets would appear to be some- what over-optimistic. This is a new sector for government participation, both in administering the regulations to the private sector as well as in implementing direct state participation in investment and in production, and while necessary experience is gained, slowdown in government action would be advisable. Besides, increases in domestic human consumption of fish, however necessary to substitute for beef imports, require a substantial change in consumer's taste; and a significant increase in exports of fish for human consumption requires the opening of new markets, a task which also will demand time and effort. - 23 - G. Minin& and Hydrocarbons 1/ 56. The mining and hydrocarbons sector were Identified in WH-206a as probably the most important ones for the medium- and long-term viability of the Peruvian development effort, since they should provide the bulk of the foreign exchange resources needed to sustain the levels of imports implied by the growth targets. The natural resource endowment is particularly rich in minerals arid, possibly, petroleum, and gives mining and hydrocarbons development a comparative advantage over other productive sectors in the medium-term. 57. A matter of concern to Peru has been the disproportion between the very large known mineral resources of the country and those that are being effectively exploited. Of a prospected area with high probability of mineralization of some 17 million has, only 3 percent is under conces- 6ions of exploitation, most of them inactive. Over the last couple of years the Government has taken action to have the concessions activated, or replaced by other contractual arrangements for resource exploitation. 58. Mining in the past decade has been characterized by a marked lack of dynamism. A relatively small proportion of profits has been reinvested in prospecting and developing fresh mineral resources. The last major min- ing development has been Toquepala, which went into production in 1961. 59. Through the normative mining law (WH206a, para. 63) and the sub- sequent General Mining Law, the Government has regulated private mining activity and has assigned a direct and dominant role to the state in the mining sector. The Mining Enterprise of Peru (1INEROPERU) has been created to carry out the e6w state responsibility for marketi;ngof minerals and copper_refining. Te uovernment's strategy for the mining sector contem- plates an important increase in the production of existing mines, the preparation of studies and active promotion to put into operation some of the more important unexploited concessions that reverted to the state (paragraph 57) and participation in the financing of these projects. Besides, it includes public sector prospection and exploration activities in areas with a high mining potential. 6o. Public investment in mining, ihich in 1971 accounted for less than 2 percent of total public investment, is expected to increase its share to about 8.5 percent in 1974 (see Table on page ). The public investment program includes as its most important mining development the project of Cerro Verde (first stage) and some reserve funds for state participation in the development of Michiquillay, Antanina, Tintaya, Bambas, Quellaveco, and Bayovar, either as state projects or no mixed enterprises. A construction contract for Cerro Verde has been signed with a consortium of construction firms and banks in the United Kingdom and Canada. Other important projects in the public investment program in- clude the construction of a copper refinery (125,000 M.T. per year) in Ilo, and a zinc refinery (150,000 M,T. per year) in the central zone. 1/ For an analysis of historical development, new laws, and policies and prospects in the petroleum and mining sector, see paras. 57 to 66 in the last Bank economic report, WH-206a. - 24 - 61. Regarding hydrocarbons, production of the Talara offsl!ore fields in the northern part of the country has been insufficient to meet ttec rapidly increasing domestic consunmption of fuels and lubricants. This will result in an estimated outflow of some $22 million in 1971 for imports of petroleum products. Encouraged by favorable geological explorations and substantial oil discoveries in Ecuador, the Government has initiated a systematic pros- pection and exploration program in the northeastern part of the country. Contracts for exploration hlave already been signed with four foreign oil companies. If oil is found, production will be shared bet-qeen the companies and the State Petroleum Enterprise (PETROPERU). In addition, an extensive program of exploration is proposed to be carried out directly by PE'T1)FIPI;U. 62. On present assumptions, public investment in hydrocarbons is likelv to reach SI. 1.2 billion in 1971, that is, about 10 percent of total public investment. Substantial increases are projected for the following years as a result of monopolistic state participation throughi PETRPOPERU in refining and marketing operations, as well as in basic petrochemicals. Investment in petroleum refining will account for about one-fourth of the total invest- ment in the hydrocarbons sector tlhrough 1974, the balance being invested in petrochemicals and fertilizers, petroleum production, transportation of fluids, and petroleum exploration (Statistical Appendix Table 5.7). III. PUBLIC INVESTMENT AND ITS FINANCING A. Technical Constraints 63. The Government's medium term investment program for 1971-75 has been formulated. However, on the basis of investment4/ for 1971 and the technical programs of various sectoral planning offices, a set of sectoral investment targets for 1972-74 has been put together by the mission with the help of the National Institute of Planning; a sunmary by sector appears in the table below, and is aggregated as "Programmed Financing Requirements." 64. In view of the extant administrative and technical capacity of the public sector, however, the yearly targets of public investment mentioned above, at least for the initial years of the plan, would appear over- optimistic; the disparity between the original investment program for 1971 and its estimated realization confirms this impression. The need for improv- ing technical and administrative capacity in the public sector was emphasized in IBRD report WH206a. The Government has shown awareness of this need and is taking action to strengthen the Planning Institute and sectoral planning units in the various ministries, so as to expand the overall capability for identification and preparation of high priority investment projects in the public sector. Much, however, still needs to be done ii, this respect. Besides, once an increased number of projects are in the pipelin.e, the re- quirements of qualified management to successfully implement them might pose an additional and even stronger constraint. Thus, it would be more realistic, in the view of the mission, to aim at an investment program of the order indicated in the table below as "Discounted Financing Requirements." 65. These requirements represent an increase over the previous year of 14 percent in 1971, 32 percent in 1972, and 26 percent and 28 percent in 1973 and 1974, respectively. Although 1972 represents a substantial in- crease over the level of investment achieved in 1971, we believe it broadly capable of achievement, provided the Government continues its efforts to improve the absorptive capacity of the major sectors. The biennial budget was put into effect for the first time in 1971, and some time has been re- quired before the various ministries and public enterprises could disaggregate the global budget figures into specific items of expenditures. Taken as a whole, the 1971-72 estimated investment would thus represent an increase of 51 percent over the level achieved in 1970. This is in line with the 58 percent increase in fixed investment considered feasible for the same period in the last Bank report (WH206a). The overall level of public sector fixed investment projected for 1972-74 (S/. 58.7 billion at 1970 prices) is 31 percent higher than that projected in the last Bank report for the same period. However, at the time of preparation of WH206a the information available only permitted a detailed sectoral analysis of public investment 1/ For lack of indicators of physical investment, disbursements for fixed investment expenditures have been used as equivalent to real investment. - 26 - LU101.C 41,59 6I7072 16 F.T-1hr.2 0R,,; 901I 1-77-7 A--i L~~~~~~~714L 710'7a-17 197,.770 6:1rlcllc 49:uM 5,795/ ~~~~~~1727 1~i B7 777 0711 F leo 7 ea fill ~~11- I T-1 -.1 .1 E- -A T-T E.1-A T. 11 - IE,~~~~ 7:7"-- '. 0177:0 7. 766761 L..LKP7 1,737 -9 5611 5131 -1 - 3,7 7.1, 7, 7., 1 06 11 71. 0 716007771'0J.17701717 1~~~~,621 9 15766 6 E;17 367 I711 1'7 Sa 7 jS : ,71 114 ' 2 - 1711 2 - 41 if. 71.011.31FY .7 I 41 1 2 7' 2 [1,4. 377 5,014 I, nS 5 [1).J P. :147 Soo . . 72 11175,62 4,12.1 Ili. P061161 ER I1F.17 1 270 5,371 562 '.5 6.9 n :I:,,. is, l 2'j-- 297 IZ7 2Th1 U, .-1577 1', 1,1111,7. ~~~~~~~ ~~1671 24' '2, 1 21. 5.1.1 O.271'. 75H '.1 PeAkl [4:', 1,24, 707. ~~~~~~~~~~~~~~~~~~~2361 105 .,~3 11 17'. 6, 1 L . 76.4I .121 7 '' I71? '171 '2 >15o, 5,91 2 7 E 14 .. 1.7. ¶1I p,'t,17'j4I.7 474017 2.7175 6~~~~~~~~~P 2 .4 160? _73 "t 171 L S,72 1.13 :,,u- 11:1. 3~~~~16 .1 173' 6 ,1 .2 [7:1 '.1 7.. 71. 17..> 7~~~~117 I'.1 3 1. P7.1:, ,9- [.2 51 .-1 1 lo5.. r 5~~? 5 2-1 ?17 7 35, S,4 I - I 51 10 ' I., '.3 61.3.5-e 3253,174 12 I. 11,70 1,.;) 10 '5l~~~~~~~~~~~~~~~~~37 11 1 ,47 1. ,QUl'16IRE. lii 7.73 ' .1 77 3 [[7 1 0' I. 79, 711' 713.171 10.137 20.71 "1 3', 1.1. F70 I7 l iI,-,'l 3.121 1 17 U- 77:7 ,91 10 .5. 1,7 I' 070 14 . p1b, ~~~~1 72 11 21 '.L 2. 1712.7 2.4 4 17 ,1ero- '.'1770 4'et-.IboW ir 1--ay 1975. 70947.F '71' 6, to[ls 119.771'77j7765 71 7.'177 1747701 7.'.e67e7o.61n717071771700e0711lo1-eo.,0o177o,t77e6.40677137.,hoao.ls,.eOla'.,,,u.7O.7I.l, 17060 6'471n7t4 sTurf .rb 71 0 7,,7 11777 Ie -77t-7.17,02 17 47 -l4 7 i77'3 Lb,. 71-1137:7 r6u0171910777j-I7271767:, 777777 7 (0741 709 29777017,1 1 l' 17 P.7771741;1774471 77,7 1019.11.67f670p0107 7477077,047- .' h 717 0P,4,4 '17174111 17761740717 4 17170716000 76 770r-0171.A 0161. ,771 t-7 677. ,.<1.[1 7Olwr7 0 71674,-- 1 by 77 - -,576-d7004 t,o 9407 l"7e---71t S ., -97177-.6171177 s,7o7,470 o'7 f,77,776- 63717177 n~oir,6:70g - Ile, 671 1 717: 1'orlgr - 27 - through 1972. Thereafter, WH206a projected public fixed investment to increase on the aggregate at 15 percent per year. The higher levels of investment now projected for 1973-74 ibuld appear to be feasible on admin- istrative grounds, since the efforts currently undertaken by the Goverrnment should start to bear fruit. B. Financial Constraints Revenue Prospects 66. Central Government revenue is projected at 45.3 billion current soles for 1972, representing an increase of 12 percent in real terms over the estimated 1971 tax revenues. This increase reflects in part the "balloon" effect of the combined fiscal years 1971 and 1972, since the liquidation period takes place at the end of the biennial budget. Also, measures taken in early 1971, including the fiscal annesty for overdue taxes, property assets revaluation and the incorporation of individual properties in company assets, are likely to yield full benefit qnly in 1972. The non- recurrent nature of these operations will result in lower current revenue growth for 1973 and 1974. Since copper prices are expected to remain low during the period, income tax from irdning companies has been projected to remain more or less stationary at the 1971 level, while other income taxes have been projected to grow in real terms in line with gross domestic product expansion (6 percent). The overall receiptsfrom taxes on income, property and exports are projected to grow at an average real rate of 5.7 percent per annum. Import tax receipts are projected to increase at 9 pjrcent_ slghtly lower than the overall 1MWort grow-Th -ite.-Taxe&s---o-nroduction and consumption - . - on productio~~S. a gnerand cosalesi are likely to grow at an average65 percent in real terms. The general sales tax and other specific taxes are assumed to grow in pace with GDP, while tax on gasoline has been projected to increase along with gasoline con- sumption. 67. The resulting ratio of central government revenue to GDP in 1972-74 is 15 percent. In order to finance the investment program mentioned above, and as recommended in WH206a, additional taxes could and should be raised without imposing an excessive burden on the economy. The Peruvian Government is aware of this need, and several tax measures not included in the above projections are presently under consideration. - 28 - Projection of Central Government Current Revenue at Present Taxes and Tax Rates (in billion of 1970 soles) Estimate Projected 1971 /1 1972 1973 1974 Current revenue 35.3 39.5 41.2 43.9 Taxes from income, property and exports 9.9 10.4 11.1 11.7 Income tax 6.2 6.2 6.7 7.0 Copper companies (2.6) (2.3) (2.5) (2.5) Other income (3.6) (3.9) (4.2) (4.5) Propery tax 0.4 0.5 0.6 0.6 Export tax 0.5 0.6 0.6 0.5 Other 2.8 3.0 3.3 3.6 Import tax 8.4 9.4 10.5 11.8 Production and consumpt:Lon tax 12.2 13.6 14.9 15.4 Stamp (7.6) (8.8) (9.4) (9.9) Gasoline (1.5) (1.6) (1.7) (1.9) Other specific taxes (3.1) (3.2) (3.4) (3.6) Other taxes 0.4 1.6 - - Non-tax revenue 4.2 4.3 4.5 4.8 Transfers 0.2 0.2 0.2 0.2 /1 Figures from tabLe on page 4 deflated by the wholesale price index (1971 107 on the 1970 base). Source: Statistical Akppendix Table 5.2 68. The most important new tax measure is expected to be the reform of the general sales tax. Under the present system any transaction on goods and services requires the payment of a stamp tax, the rate to be applied depending on the nature of the transaction. The control of the 90,000 entities affected by this tax is present.1j outside the actual management capability of the fiscal administration, contributing to high tax evasion. The present tax will now be replaced by a tax at the production level, (or at the time of import), reducing the number of potential taxpayers to about 20,000. Stricter control can thus be exertedi, reducing evasion and simplifying tax administra- tion. Government studies evaluate the increase in tax revenues resulting from this measure at about S/.3 billion per year. However, it is likely that certain sectors will be granted tax exemptions and the actual fiscal effect of these measures will probably fall below this estimate. - 29 - 69. The Government is also considering an adjustment in the price for petroleum products (domestic fuel, diesel oil and gasoline) on the lines suggested in WH206a. Prices of petroleum products in Peru are pre- sently among the lowest in the world (regular gasoline at the pump is sold for US$0.15 per gallon) and an increase would appear legitimate. If implemented, the proposed measure would yield some S/. 1.6 billion per annum for the budget and some SI. 700 million for the government petroleum company PETROPERU. Additional changes in the tax system, aimed at reducing legal tax exemptions, are being discussed. These various measures are estimated to yield about SI. 500-700 million annually. 70. The maximum aggregate effect of all fiscal actions under considera- tion is about SI. 6 billion per annum, or 18 percent of present tax revenue. It is, however, difficult at present to foresee which of the various actions will be adopted by the Government, and when they might take effect. Current Expenditures 71. Central Government current expenditures have been projected by the mission to expand at a moderate rate (5 percent in real terms) in 1971-74. This projection reflects the wage and salary increases forecast for 1972, resulting from already agreed adjustments in civil servants' salaries. Purchases of goods and services have been projected to grow by 10 percent a year on the average; interest payments are expected to rise substantially during the period on account of internal and external debt outstanding. Current transfers and military expenditures have been projected to remain stationary at the level budgeted for 1972. Central Government Current Expenditures (millions of 1970 soles) Estimate /1 1972 1973 1974 1971 Current Expenditures 31.1 33.9 34.9 36.0 Wages and salaries 15.0 15.9 16.4 16.9 Purchase of goods and services 1.8 2.2 2.3 2.4 Interest payments 2.7 3.0 3.4 3.8 Current transfers 4.8 6.3 6.3 6.3 Military outlays 6.7 6.5 6.5 6.5 /1 Figures from table on page 4 deflated by the wholesale price index (1971-107 on the 1970 base). Source: Statistical Appendix Table 5.2 - 30 - Public Savings 72. In the absence of new tax measures, the resulting Central Govern- ment current account savings are estimated to rise in real terms from S/. 5.6 billion in 1972 to nearly S . 8 billion in 1974. These levels are below those projected in WH206a]l because of a higher level of current expenditures and revised overall revenue projections. In addition to the Central Govern- ment surplus, there are also savings in the rest of the public sector -- local governments, social security, public institutions and State enter- prises. The exact level of these savings is not known; recently the Government has started consolidation of public finances, but definitive results are not yet available. It may be expected that non-budgetary public savings will be increasing in the future, as a result of tightened control over current expenditures of public enterprises and of widenedl par- ticipation of the Government in the economy. The most important Government enterprises which are expected to generate savings are PETROPERU (petroleulm), EPCHAP (fishmeal) and CORMAN (power). A level of current non-budgetary savings of the order of S/. 3.1 billion in 1970 and 1971 is consistent with the known levels of public investment and their financing in these years. These non-budgetary savings have been projected to increase at 10 percent per annum in real terms. Together with the projected current budgetary surpluses, the aggregate public savings are projected to rise from an average of S/. 9 billion i:n 1970-71 (3.9 percent of GNP) to 12.4 billion in 1974 (4.3 percent of GNP). Financing of Public Investment 73. In addition to f-ixed public investment indicated in Table on page 26 financial investment in 1972-74 is projected in line with previous trends. Without new tax measures, public savings will be able to finance about 50 percent of public investment. The drawdown on existing external loans and on new project loans based on the Project List, net, is estimated to finance another 12 percent of public investment. The gap which would remain would rise from S/. 5.3 bilLion in 1971 to S/. 9.7 billion in 1974. A part of this gap will be met by internal borrowing. The Government has on many occasions repeated its intention to capture private savings for financing the public investment program, through government bond emissions sold directly to individual private savers, or through the banking system by requiring banks and savings and loans institutions to invest a certain por- tion of their deposits into government bonds. The amount of feasible net government borrowing would depend on the competing demand for credit by the rest of the economy, as well as by the permissible drawdown on foreign ex- change reserves. In 1971, net internal borrowing amounted to S/. 4.3 billion (expressed in 1970 prices), accompanied by a reserve drawdown of US$70 million (S/. 2.7 billion equivalent) and a domestic price increase of about 7 percent. 1/ S/. 7.6 billion in 1972 and S/. 9.6 billion in 1974. 2/ This comparison refers to projections based on existing taxes, i.e., without additional revenue measures. FINANCING OF PUBLIC INVESTMENT: AN ILLUSTRATIVE PATTERN (Billion 1970 Soles) Total Projected by Estimated Projected Total Last Mission 1970 1971 1972 1973 1974 1972-7h 1972-74 1. Public Investment 11.0 12.7 16.7 20.9 26.4 64.0 55.6 Gross fixed capital formation /a 10.1 11.5 15.2 19.1 24.4 58.7 44.9 Financial investment /b 0.9 1.2 1.5 1.8 2.0 5.3 10.8 2. External Borrowing (net) /c -0.1 0.1 1.0 2.3 4.3 7.6 3.6 Gross borrowing 4.6 5.7 6.6 9.0 10.2 25.8 19.4 Amortization -4.7 -5.6 -5.6 -6.7 -5.9 -18.2 -15.8 3. Public Savings 10.5 7.3 9.1 9.8 12.4 31.3 31.9 Central Government s'urplus at present taxes and rates /d 7.4 4.2 5.6 5.9 8.o 19.5 25.7 Rest of public sector /e 3.1 3.1 3.5 3.9 4.4 11.8 6.2 4. Gap Fl - (2 + 3) 7 o.6 5.3 6.6 8.8 9.7 25.1 20.1 (a) New tax measures /f 2.7-5.4 4.o-6.0 5.4-6.6 12.1-18.0 7.4 (b) Internal borrowing (net)/g -0.5 4.3 (c) Non-project foreign assistance or external 1.2-3.9 2.8-4.8 3.1-4.3 7.1-13.0 12.7 debt rescheduling Ih 1.1 1.0 /a Corresponds to "Discounted Financing Requirements", as shown in the Summary Table on page 26. Gross fixed capital formation for 1970 is the Government's revised estimate as of January 1972. /b Includes cash payments for expropriations made under the Agrarian Reform Program. /c External borrowing (excluding private borrowing with gover'ment guarantee) includes both project and non-project assistance (other than debt refinancing) in 1' ', and 1971. For 1972-74 includes drawdown on existing loans, project and non-project; with respect to new loans includes drawdown only on project loans. /d Appendix Table 5.2. /e Savings from the Rest of Public Sector in 1970 and 1971 have been determined as residuals from known levels of public investment and its financing. Thereafter, they are projected growing at 10 percent per annum in real terms. If The yield of new taxes has an upper limit given by the maximum effect (in real terms) estimated by the government for 1972, projected to grow at 10 percent thereafter; and a lower limit of 50 percent of the Government's estimated yield for 1972, increasing to reach the full estimated 1972 yield in 1974. /g Table on the Summary of the Banking System, p. 6, expressed in 1970 prices. /h For 1970 and 1971, refinancing of external debt. - 32 - A further reserve drawdown of US$100 million has been projected for 1972-74 which would allow for some non--inflationary domestic borrowing. However, internal borrowing would have to be kept at levels below those obtained in 1971 if price increases are to be maintained within the limits envisaged in the Government's development program (7 percent per annum). 74. In any case, new tax measures will be required for the financing of the investment program. As indicated, the Government has under considera- tion a number of measures with a maximum aggregate effect of S/. 6 billion in the first year. Final decilsions have not yet been taken. Assuming that the full yield will be achieved gradually, an aggregate of S/. 12 billion would be mobilized during 1972--74. This, together with a moderate amount of domestic borrowing would not be sufficient to fully finance domestic investment. In this case, some non-project foreign assistance or further debt rescheduling would be necessary. To the extent that there are longer delays in the execution of the investment program than envisaged in this report, or that the aggregate yield from new taxes is higher than S/. 12 billion, the unfinanced gap woulid be correspondingly reduced. - 33 - IV. BALANCE-OF-PAYMENT PROSPECTS, 1972-74 A. Exports 75. Exports are likely to grow relatively slowly in the next few years, basically because the prices of copper and fishmeal are expected to remain below the 1970 level. The slowdown in the European industry, the slow recovery from recession in the United States, significant reductions in Peoplets Republic of China's copper imports, and a de-escalation of hostilities in the Vietnam War are contributing to a reduced growth in demand for copper. On the other hand, there are additions to worldwide copper production capacity which will come on stream in the next few years. The price of copper f.o.b. Peru has been projected to average 41.5 cents during 1972-74, about the same as in 1971. In the next three to four years the volume of Peru's copper exports will show modest increases since new mining investment will not yet be operational. However, while earnings from copper are projected to increase only slowly, the outlook for other minerals, e.g., silver and zinc appears more favorable, since both volume and price are expected to increase. 76. The rolume of fishmeal exports is projected to remain constant at 1.8 million M.T., which corresponds to 10 million tons of anchovy catch regarded compatible with the ecological equilibrium. The price of fishmeal has been projected to decline to $150 per M.T. to take account of an expected growth of world production of around 4 percent, according to FAO sources. Unless the coefficient of fishmeal production can be improved to compensate for the limit to the anchovy catch, Peru's world market share in fishmeal is likely to decline from 55 percent average of 1966-69 to about 46 percent in 1974. 77. Prospects for Peru's exports of traditional commodities like sugar, coffee and cotton are not very encouraging. The expected fall in cotton prices combined with higher domestic consumption by the textile industry will most likely result in a decline in export earnings. Sugar and coffee earnings are expected to increase moderately because of quota limitations. As a whole, exports of agricultural commodities are projected to grow by about one percent per annum between 1970 and 1974. 78. As a result of lower prices of copper and fishmeal, and after allowing for some changes in the structure of exports as shown below, over- all exports are expected to graw at an annual average rate of no more than 1.3 percent between 1970 and 1974. Since most of the expected price fall and the associated decline in aggregate export value has taken place already in 1971, however, the period between 1971 and 1974 looks much better--a 6 percent annual increase. - 34 - PERCENTAGE SHARE IN MERCHANDISE EXPORTS AND GROWTH RATE _ OF MAJOR COMMODITIES, 1972-74 Growth Rate Growth Rate 1969 1970 1971 1972-74 1970-74 1971-74 Copper 30.1 23.8 21.5 20.7 -1.4 5.9 Other Minerals / 23.4 21.3 20.3 25.4 7.1 16.0 Fishmeal 22.9 29.4 28.8 26.5 -2.9 1.0 Agricultural Products?! 16.6 15.4 16.6 15.6 0.9 2.9 Total Exports 1.3 6.1 1/ Iron ore, lead, ziznc and silver. 2/ Cotton, sugar, coffee and wool. Source: Statistical Appendix, Table 3.3. B. Imports 79. Demand for imports through 1974 can be expected to remain high. Capital goods imports are likely to continue increasing as higher investment levels are carried out; imports of raw materials and intermediate goods will grow in keeping with the expansion of manufacturing activity. Imports of consumer goods have been projected to remain more or less stationary, on the assumption that the Government succeeds in maintaining food imports at their present level by stimulating domestic production and tightening import restrictions. Altogether, imports in real terms are projected to increase at about 10 percent per annum in the next four years, in response to a GDP growth rate of 6 percent and growth in investment of 16 percent per annum. As a result of these trends, the trade balance is likely to shift from a sur- plus of US$130 million in :l971 to a deficit of US$11 million in 1974. Prospects beyond that date will depend on the rate of expansion of copper production and on the development of other export industries--the elements now in the forefront of the Government's plans. - 35 - MERCHAkIDISE IfPORTS, 1969-74 (in US$ millions) Rate of Growth, 1970-74 ACTUAL ESTIMATB PROJECTED In Nominal In Real 1969 1970 1971 1974 Terms Terms Consumer goodseL 96 99 n.a. 102 1.0 (0-1) Raw materials and, inter- mediate goodsJ 363 336 n.a. 494 10.2 (8-9) Capital goods3/ 192 251 n.a. 503 19.0 (16) Total imports 651 686 781 1 09 12.5 10.3 X =.9 1/ Includes a part of food imports (finished goods). Food imports subject to further domnestic processing are included in the category of raw materials and intermediate goods. v Proiected to increase at the same rate as industrial production. 3/ Projected to increase at the same rate as investment. C. Capital Requirements 8c. Assiming that the present deficit on factor income and non-factor services will rise gradually,!/ the current account of the balance of payments is expected to show deficits aggregating US$635 million in 1972-74. Amortiza- tion payments falling due in this period are heavy, US$483 million. External capital requirements for 1972-74 are thus projected at about $1,118 million (US$370 million per year on the average). This compares with the $1,133 mil- lion capital requirements presented in the last Bank report. The main identified sources of financing of gross capital requirements are: direct investment ($258 million), project assistance related to the public investment program, ($668 million) and a draw down on foreign exchange reserves ($100 million). 1/ The $475 million factor income payment estimated for 1972-74 is lower than the level projected in WH-206a because of ctrieter control of profit remittances in force since early 1970 and reduced profits frz copper companies resulting from lower copper prices. - 36 - EXTERNAL CAPITAL REQUIRMNTS, 1972-74 (US $ million) Previous Mission's EstLmates 1972 1973 1974 1972-74 1972-1974 Required Gross Capital Inflow 298.8 383.5 435.7 1,118.0 1,133.0 Balance on Current Account -151.4 -205.0 -278.4 -634.8 -700.0 Resource Gap - 33.4 - 73.6 -132.0 -239.0 -211.0 Net Factor Payments -148.0 -156.4 -171.4 -475.8 -564.0 Net Transfers 30.0 25.0 25.0 80.0 ,0 Amortization of Public Debt -147.4 -178.5 -157.3 -483.2 -433.0 Sources of Finance Net Private Capital Inflow 59.0 84.5 114.5 258.0 375.0 Gross Public Capital Inflow 174.3 232.6 261.1 668.o 576.o Disbursements on Existing Loans 119.6 96.2 58.3 274.0 188.0 Disbursements on New Project Loans 54.7 136.5 202.8 394.0 388.0 Drawdown on Reserves 35.0 35.0 30.0 100.0 105.0 Unfinanced Gap 30.5 31.4 30.1 92.0 75.0 Net Public Capital Inflow 26.9 54.1 103.8 184.8 1144.0 - 37 - 81. Net direct private foreign investment is projected to be about $117 million below the figure indicated in the last Bank report (WH206a). This change results from delays and modifications in the mining investment program. Financing for Cuajone copper project has been secured until the end of 1972 and, although the full financing for the project has not yet been assured, the present projection assumes normal completion of the project as initially planned. WH206a projected a second major mining project to be developed jointly by the Government and private foreign investors. The Government has signed a contract with a consortium of British and Canadian banks for the development of Cerro Verde, and is negotiating financial arrangements for Tintaya, on the basis of operating both mines as government- owned enterprises financed with foreign borrowing. The projected level of direct foreign investment for mining will therefore be correspondingly re- duced. Additional oil exploration contracts were, however, not visualized in the last report. Four new contracts for exploration in the Selva have already been signed with foreign oil companies; the present projection assumes an inflow of $20 million for each year on this account. If oil is struck in promising quantity, capital inflows for oil investment in sub- sequent years could be considerable. 82. In the near future a considerable gross capital inflow will be necessary. About $275 million is expected to be drawn during 1972-74 from loans already contracted; an additional $394). million could be mobilized from disbursement on new project loans to be contracted in 1972- 74. This level calls for lending commitments of $780 million. This com- pares with the target conmmitment level set forth in the project list (IBRD document of January 25, 1972) aggregating US$1,200 million, implying a slippage of the order of 35 percent. Even after allowing for this slippage, the assumed new lending commitments and the associated disbursements are ambitious. It is possible that administrative delays in commitments and disbursements would be longer than projected in this report; this would in effect imply a stretching of the next three-year program over a four- year period. In any case, however, maximum efforts should be made to achieve in 1972 as large a commitment level on projects as possible, and thus replenish the project pipeline after very small commitments in the last several years. 83. The project list assumes external financing of 60 percent of total project cost on the average; this includes, again on the average, financing of local costs equivalent to 10 percent of total cost of projects in the list. This order of financing of local costs will not accomplish in full the required resource transfer: as indicated in the table on p.36 and further commented on below, an unfinanced gap will probably still remain. Nonetheless, the projected local cost coverage would contribute to the solution of the resource transfer problem. - 38 - ILLUSTRATIVE PROGRAM FOR EXTERNAL BORROWING, PROJECT LOANS 1972-74 (US $ million) Annual Total Average 1972 1973 1974 1972-74 1972-74 Disbursements 174 233 261 668 222 From Existing Loans 121 96 58 274 91 From New Loans 54 137 203 393 131 Commitments 200 270 310 780 260 Development Agencies 140 190 220 550 183 Suppliers' Credits 60 80 90 230 77 External Debt Outstanding /a 887 919 994 /a Excluding undisbursed and repayable in foreign currency. Source: Mission estimates. 84. From what can now be seen, the project-related sources of financing will not provide fully for Peru's capital requirements over the period 1972- 74. Even assuming $100 million drawdown on reserves, there still remains an unfinanced gap of about $90 million. As earlier indicated, this would call for non-project assistance or debt rescheduling, unless further restrictions on imports are imposed. affecting the desired investment and consumption levels, or the investment expenditures lag due to technical constraints. D. External Debt 85. Despite the high level of disbursements expected in the next several years, external debt will increase only moderately since there will be heavy payments of amortization due on existing debt. External public and publicly guaranteed debt repayable in foreign currency is estimated to amount to $879 million by the end of 1971 ($1,187 million including undisbursed) and is projected to reach $994 million by the end of 1974. In 1972, net public capital inflow is projected to amount to only $26.9 million and is projected to rise to $103.8 million in 1974. Net resource transfer (gross inflow minus debt service payments) projected for 1972-74, in the absence of non-project assistance or debt rescheduling, will not exceed US$24 million in total. - 39 - 86. Debt service payments estimated at $205 million in 1971, are expected to reach $230 million in 1973 and to decline to $213 million in 1974. Debt service payments -- at 19 percent of exports of goods and services in 1971 -- represent a substantial burden on the country's international liquidity. This is due to a very unfavorable debt structure. The service payments on debt already contracted before 1971 average US$200 million per year in 1972-74. They fall off sharply after 1975; in 1977-79 they average US$60 million or less than 6 percent of present exports. If future loans are contracted on favorable terms, the debt servicing burden in the latter 1970's should not be excessive, assuming export expansion projected in this report is realized. STATISTIGAL APPENDIX Table No. 1.1 Population and GNP Average Annual Growth Rates, 1950-71 2.1 National Accounts at Current Prices, 1965-71 2.2 National Accounts at 1970 Prices, 1965-71 2.3 ONP Deflator, 1965-71 2.4 Gross Domestic Invostment Deflator, 1965-71 2.5 Foreign Exchange Conversion Rates, 1950-71 2.6 Industrial Origin of Gross National Product, 1965-71 2.7 Growth Rates of Gross National Product by Sector of Origin, 1965-71 2.8 Macro-Economic Growth Indicators, 1965-71 2.9 National Account Projections (current prices) 2.10 National Account Projections (1970 prices) 3.1 Balance of Payments, 1969-74 3.2 Balance of Payments, 1969-74 3.3 Commodity Excports, 1969-74 3.4 International Reserves 4.1 Peru - External Public Debt Outstanding as of December 31, 1970 4.2 Peru - Estimated Future Service Payments on Erternal Public Debt Outstanding Including Undisbursed as of DeooSber 31, 1970 5.1 Central Government Current Account, 1969-_74. (current prices) 5.2 Central Government Current Account, 1969-74 (1970 prices) 5.3 Public Inmvestment 1971-1974 (Agriculture) 5.4 Public Investment 1971-1974 (Industry) 5.5 Public Investment 1971-1974 (Fisheries) 5.6 Public Investment 1971-1974 (Mining) 5.7 Public Investment 1971-1974 (Hydrocarbons) 5.8 Public Investment 1971-1974 (Power) 5.9 Public Investment 1971-1974 (Transport and Commuications) 5.10 Public Investment 1971-1974 (Education) 5.11 Public Investment 1971-1974 (Health) 5.12 Public Investment 1971-1974 (Housing) 5.13 Public Investment 1971-1974 (Other) 6.1 Monetary Situation, 1965-70 6.2 Annual Percent Variation in Monetary Situation, 1966.70 6.3 Summary Accounts of the Banking Systma 6.4 Central Reserve Bank Sumuary Aocounta 6.5 Banco de la Nacion utmmary Aocounts 6.6 Summary Accounts of the Specialized Banks 6.7 Summary Accounts of the Coameroial and Savings Banks 5!ATLI5TPALAP?W]X ..t /;~~~~ --.. (oat Id) rable No. 7.1 Anohovy Catch 7.2 Indix of Manasfaoturing Prodution 8.1 Change in Cost of Livin Irdex, 1965-70 8.2 Cost of Living IMdsr, 1967-71 8.3 Price Indexes, 1965-71 Table 1.1: POPULATION AND GNP AVERAGE ANNUAL GROWTH RATES, 1950-71 (Cumulative annual growth rate - percentage) 1950-66 1955-60 1960-65 1965-71 1960-71 Population 2.0 2.6 3.0 3.1 3.1 GNP (Market Prices constant Prices) 6.0 4.3 6.3 3.7 5.0 GNIP (per capita) 4.o 1.6 3.2 o.6 1.8 Source: Central Reserve Bank, Ministry of Finance and Mission estimates. Table 2.1: NATIONAL ACCOUNTS AT CURRENT PRICES, 1965-71 (In millions soles) 1965 1966 1967 1968 1969 1970 1971 Consumption Expenditure 96,028 112,254 130,234 158,338 71,662 195,172 226,856 Private Consumption 83,486 97,458 11]3,513 136,959 152,229 172, 34 202,430 Government Consumption 12,542 14,796 16,721 19,379 20,433 22,238 24,426 Gross Domestic Investment 21,370 27,499 31,017 25,783 27,178 25,628 37,254 Private Capital Formation 16,163 1d,313 19,649 20,837 21,870 23,057 29,000 Government Capital Formation2Y 3,o47 4,250 3,745 3,277 3,490 4,589 6,142 Change in S-ccks 2,160 4,936 7,623 1,689 1,818 1,982 2,112 E)corts of Goods and Non-Factor Services 20,705 2 27,087 37,822 39,884 46,320 641.6l Imports of Goods and Non-Factor Services 22,662 26,715 31,293 34,861 34, 40 36,850 40 21 Net Exports of Goods and Non-Factor Services -2,957 -2,497 -4,206 2,961 ,344 9,470 840 Gross Domestic Product at Market Prices 115,443 337,256 157,045 187,082 204,184 234,270 264,)50 Net Factor Income Payments 2,441 3,240 4,282 5,540 5,867 5,244 5, 46 Gross National Product at Market Prices 113,000 i34,o6 152,763 181,242 198,317 224,026 259,469 1/ Includes central and local governnent as well as the National DevelcprIent Func] (FMIDF). The rest of the public sector is included as part ci' the private sector. Source: Central Reserve Bank and mission estimates. Table 2.2: NATIONAL ACCOD4TS AT 1970 PRICES, 1965-71 (In millions soles) 1965 1966 1967 1968 1969 1970 1971 Consumption Expenditure IL5279 164,028 171,555 176,231 180,631 195,172 208,586 Private Consumption 134,703 144,379 150,385 154,383 158,824 172,934 185,806 Government Consumption 19,876 19,649 20,720 21,848 21,807 22,238 22,780 Gross Domestic Investment 32,776 40,028 38,917 27,635 27,932 29,628 34,649 Private Capital Formation 24,361 26,448 25,315 22,017 22,275 23,057 26,951 Government Capital Formation Y 4,830 6,322 4,931 3,666 3,649 4,589 5,727 Change in Stocks 3,585 7,258 8,671 1,952 2,008 1,982 1,971 Exports of Goods and Non-Factor Services 42,779 42,940 43,830 47,755 45,530 46,320 43,741 Imports of Goods and Non-Factor Services 32,463 37,208 40,171 35,609 35,137 6,850 9,728 Net Exports of Goods and Non-Factor Services 10,316 5,732 3,659 12,146 10,393 9,470 4,013 Gross Domestic Product at Market Prices 197,671 209,788 214,131 216,012 218,956 234,270 247,248 Net Factor Income Payments 3,497 4,513 5,497 5,965 5,968 5,244 5,317 Gross National Product 194,174 205,275 208,634 210,047 212,988 229,026 241,931 1/ Includes central and local government as well as the Nationa]. Development Fund (FNDE). The rest of the public sector is included as part of the private sector. Source: Central Reserve Bank, Ministry of Finance and mission esti'mates. Table 2.3: GNP DEFLATOR, 1965-71 Annual Rate Year Deflator of Change (%) 1965 0.582 13.5 1966 o.653 12.2 1967 0.732 12.1 1968 0.863 17.9 1969 0.931 7.9 1970 1.000 7.4 1971 1.072 7.2 Source: Central Reserve Bank, Ministry of Finance and Mission estimates. Table 2.4: GROSS DOMSTIC INVEST1T DEFLATOR, 1965-71 Annual Rate Year Deflator of Change (§ ) 1965 o.652 4.0 1966 0.687 5.4 1967 0.797 16.0 1968 0.933 17.1 1969 0.973 4.3 1970 1.000 2.8 1971 1.075 7.6 Source: Central Reserve Bank. Table 2.5: FOREIGN EXCHANGE CONVERION RATES, 1950-71 (Soles per US$1) Year Conversion Rate 1950 14.95 1951 15.28 1952 15.60 1953 19.89 1954 19.00 1955 19.00 1956 19.00 1957 19.00 1958 24.49 1-959 27.70 1960 26.76 2961 26.82 1962 26.82 1963 26.82 2964 26.82 1965 26.82 1966 26.82 1967 30.61 1968 38.70 1969 38.70 1970 38.70 1971 38.70 Source: Central Reserve Bank. Table 2.6: INDUSTRIAL ORIGIN OF GROSS NATIONAL PRODUCT, 1965-71 1965 1966 1967 1968 1969 1970 1971 (In million of 1970 Soles) GNP 194,174 205,275 208,634 210,047 212x988 229,026 212j931 Agriculture 36,101 37,167 38,337 36,180 36,138 38,812 38,982 Agriculture and Forestry (32,768) (33,239) (33,838) (31,611) (32,309) (33,712) (34,555) Fishing (3,333) (3,928) (4,499) (4,569) (3,829) (5,100) (4,427) Mining 11,730 11,659 11, 996 12,558 12,360 12,743 12,042 Manufacturing 35,973 39,508 41,484 42,480 42,607 47,367 51,808 Construction 8;511 9,266 8,284 6.923 6,903 7,683 9,066 Electri.city, Gas & Water 1,845 1,971 2,165 2,273 2,357 2,476 2,776 nership of Dwelli.ng 11,132 111.76 11,833 12.201 12.580 12,970 13,541 Public Administration 16,131 17,113 17,695 18,103 18,464 19,257 21,178 Other 72, 751 77.115 76,840 79,329 81,579 87,718 92,538 (As percent of GNip) GNP 100.0 100.0 100.0 100.0 100.0 100.0 100.0 Agriculture 18.6 18.1 18.4 17.2 17.0 16.9 16.1 Agriculture and Forestry (16.9) (16.2) (16.2) (15.0) (15.2) (14.7) (14.3) Fishing (1.7) (1.9) (2.2) (2.2) (1.8) (2.2) (1.8) Mining 6.0 5,7 5.7 6.0 5.8 5.6 5.0 Manufacturing 18.5 19.2 19.9 20.2 20.0 20.7 21.4 Construction 4.4 4.5 4.0 3,3 3.2 3.4 3.7 Electricity, Gas & Water 1.0 1.0 1.0 1.1 1.1 1.1 1.1 Ownership of Dwelling 5.7 5.6 5.7 5.8 5.9 5.6 5.6 Public Administration 8.3 8.3 8.5 8.6 8.7 8.4 8.8 Other 37.5 37.6 36.8 37.8 38.3 38.3 38.3 Source: Central Reserve Bank, Minisbry of Finance and Mission e5;timates. Table 2.7: GROWTH RATES OF GROSS NATIONAL PRODUCT BY SECTOR OF ORIGIN, 1965-71 (Annual % Change) 1965 1966 1967 1968 1969 1970 1971 GNP 4.8 5.7 1.6 0.7 1.4 7.5 5.6 Agriculture -2.4 3.0 3.1 -5.6 -0.1 7.4 0.4 Agriculture & Forestry (-0.5) (1-4) (1.o) (-6.6) (2.2) (4.3) (2.5) Fishing (-17.7) (17-8) (14-5) (1.6) (-16.2) (33.2) (-13.2) Mining 3.8 -0.6 2.9 4.7 -1.6 3.1 -5.5 Manufacturing 8.4 9.8 5.0 2.4 0.3 11.2 9.4 Construction 13.0 8.9 -10.6 -i6.4 -0.3 11.3 l1.0 Electricity, Gas & Water 18.7 6.8 9.8 5.0 3.7 5.0 12.1 Ownership of Dwelling 3.1 3.1 3.1 3.1 3.1 3.1 4.4 Public Administration 5.6 6.1 3.4 2.3 2.0 4.3 10.0 Other 6.o 6.o -0.h 3.2 2.8 7.5 5,5 Source: Central Reserve Bank, Ministry of Finance and Mission estimates. Table 2.8: MACRO-ECONOMIC GROWTH INDICATORS, 1965-71 Real Rate Gross 2 Rate of Domestic Year of Growth Investment Price Savings GNP % Rate Change . Rate 1965 4.8 0.166 13.5 0.218 1966 5.7 0.191 12.2 0.218 1967 1.6 0.182 12.1 0.199 1968 0.7 0.128 17.9 0.184 1969 1.4 0.128 7.9 0.175 1970 7.5 0.126 7.4 o.167 1971 5.6 0.140 7.2 0.156 j Gross Domestic investment as fraction of GDP (at 1970 prices). j Percentage change in GNP deflator over previous year. j Domestic savings as fraction of GDP (at 1970 prices). Source: Tables 2.2 and 2.3. Table 2.9: NATIONAL ACCOUNT PROJECTIONS (Current Soles million) 1970 1971 1972 3°73 1974 Gross Domestic Product 234,270 264,950 300,620 340,963 386,719 Net Factor Payments 5,244 5,461 5,728 6,053 6,633 Gross National Product 229,026 259,489 29h,892 334,910 380,086 Gross Domestic Investment 29,628 37,254 48,099 59,668 71,543 Gross Fixed Investment 27,646 35,142 45,657 56,846 68,282 Increase in stocks 1,982 2,112 2,442 2,822 3,261 Exports of goods and non- factor services h6,320 41,641 44,633 47,798 50,852 Imports of goods and non- factor services 36,850 40,801 45,925 50,647 55,960 Resource Balance 9,470 840 - 1,292 -2,849 -5,108 Gross Domestic Savings 39,098 38,o94 46,807 56,819 66,43 5 Gross National Savings 33,854 32,633 41,079 50,766 59,802 Consumption 195,172 226,856 253,813 284,144 320,284 Domestic Savings Rate (%) 16.7 14.4 15.6 16.7 17.2 Investment Rate (%) 12.6 14.0 16.0 17.5 18.5 NCTE: This table has been converted from the constant price table u3ing the following steps: i) Gross Domestic Product converted irino current soles by assuming an annual inflation rate of 7%. ii) Exports, imports and factor payments converted into current soles by multiplying the balance of payments figures by the present exchange rate (assuming that the present equilibrium will continue). iii) Investment calculated from the constant i-,1rice investment rate. iv) Savings and consumption calculated as residue. Table 2.10: NATIONAL ACCOUNT PROJECTIONS (1970 million Soles) 1970 1971 1972 1973 1974 Gross DomestiC Product 234,270 247,248 262,083 277,808 294,476 Net Factor Payments 5,244 5,317 5,468 6,085 r-oss National Prodct 229,026 2 41,931I 2356,615 272,140 288,391 Grosa Domest4-c i-eatment 29,628 34L,649 4l1,933 --8,616 54j)478 Gross Fixed Investment 27,646 32,678 39,804 46,317 51,995 Increase in stock:s 1,982 1,971 2,129 2,299 2,483 Exports of goods + NIFS 46,320 43,7741 46,204 48,724 51,108 Imports of goods + NFS 36,850 39,728 43,843 47,422 51,340 Resource Balance 9,470 4,013 2,361 1,302 - 232 Gross Domestic Savings 39,098 38,662 44,294 49,918 54,246 Gross National Savings 33,854 33,345 38,826 414,250 48,161 Consumption 195,172 208,586 223,257 233,558 240,230 Export Price Index 100.0 95.2 96.6 98.1 99.5 Import Price Index 100.0 102.7 10o.75 106.8 109.0 Domestic Savings Rate (%) 16.7 15.6 16.9 18.0 18.4 Investment Rate (%) 12.6 i4.o 16.0 17.5 18.5 Growth Rates 1970-74 1971-74 GDP 5.9 6.0 Exports 2.5 5.3 Imports 8.6 8.9 Investment 16.4 16.3 Consumption 5.3 4.8 I.C.O.R. 2.43 2.52 Table 3.1: BALANCE OF PAYMENTS, 1969-74 (US$ million) PROJECTIONS 1969 1970 1971 1972 1973 197h (est.) 1. Exports of goods & non-factor services 1,030 5 1,196.9 1,076.0 1,153.1 1,235.1 I,31j.0 a) Merchandise 881.5 1,032.2 909.4 972.2 1,033.2 1,087.1 b) Non-factor services 149.0 164.7 166.6 181.1 201.9 226.9 2. Imports of goods & non-factor services 886.2 952.1 1,054.3 1,186.7 1,308.7 1 h46.0 n) Merchandise 651.1 6860 781.0 885.6 986.3 1,098.8 b) Non-factor services 235.1 266.1 273.3 301.1 322.4 347.2 3. Resource Balance 144.3 24_.8 21.7 -33.h -73.6 -122.0 L. Net Factor Income Payments -151.6 -135.5 -140.9 -148.o -156.1 -171.14 a) Interest on public debt 45.4 50.7 54.80 5 T. i) on existing loans (45.4) (50.7) (56.8) (54.0) (45.3) (39.L) ii) on new loans ( -- ) ( -- ) ( -- ) ( -- ) (6.1) (16.0) b) Other payments 106.2 84.8 8h.1 94.0 105.0 116.0 5. Transfers (net) 31.3 90.2 39.1 30.0 25.0 25.3 (A) Balance on current account 24.1 199.5 -80.1 -151.4 -205.0 -278.4 (B) Capital account 1. Private long term (net) -10.1 -80.6 7.3 59-0 84.5 114.5 a) Direct Investment -.6 1114.5 b) Nationalization -- -71.2 -- -- -- c) Other (net) 6.4 -10.0 -7.9 2.8 -- Gross disbursements (15-7) (15.2) (14-7) (21.'. --- Amortization (9.3) (25.2) (22.6) (19.-1 -- 2. Public and Public guarantee 130.0 100.4 30.5 26.9 54.1 103.8 a) Ecisting loans 130.0 29.2 _ -27.B -77.4 -8. i) Central Government (net) -73.1 loO -1.0 -13.0 -48. -3W4 Gross disbursements (II-7) (95.3) (1'T=7) ( 8T9 ) ( )5.9) Amortization ( 47.9) (77.3) (113.8) (111.1) (129.7) (95.3) (Refinancing, net) ( 58.9) ( 7.3) (-12.9) (-47.8) (-76.1) (-50.2) Gross disbursements ( 60.9) (29.7) ( 28.6) ( 1.3) ( --- ) (--- ) Amortization ( 2.1) (22.4) ( 41.5) (49.1) ( 76.1) ( 50.2) ii) Decentralized Agencies (net) 54.5 8.9 31.3 -15.5 -26.2 -_40.6 Gross disbursements 96-o 525 T1.2 15.5 12.0 F1 Amortization 41.5 43.6 29.9 31.3 38.3 42.0 iii) Private guarantee (net) 2.1 2.' 0.2 0.7 -2.5 -5.5 Gross disbursements 7.2 Ti- -73.0 - Amortization 5.1 4.6 h.9 5.3 5.5 5.5 b) New loans (net) 5Xi.7 l'1.5 188.3 Gross disbursements 54.7 136.5 202.8 Amortization -- 5.0 14.5 c) Nationalization ( __) (71.2) ( --) ( --) ( --) ( ) d) Unfinanced gap 30.5 31.4 20.1 3. S.D.R. allocation _ 14.3 13.8 - - I4. Errors and omissions (including short term capital) -108.8 25.3 -141.9 - - - 5. Change in reserves (- = increase) -35.2 -258.9 70.4 35.0 35.0 30. '!emo. items Debt service(public & public guarantee) 139.9 176.2 205.4 201.14 229.9 212.7 Debt service ratio (%) 13.6 14.7 19.1 17.5 18.6 16.2 Arce: Central Bank, Mission estimates and projections Tail. 3.2: 1A3611116 OF3 P1AYM12T, 19t~7-1, (71J$ ra7iizon) 1969 1970 197l1 (stj6c 1972 1973 1971. CREDIT DEI BALANCfE CREDIT DEBIT BALANCE, G9EyT DEBIT 8i XE CREDIT DEBIT BALALNCE CREDIT DEBIT BAIANCE CREDIT DEBIT BALAYCE 1. Good.sand Services 1jo3j,5 1.01.6.8 7. 1j2126 1,103.3 109.3 1,083.5 1,202.9 -119). 1iC,)5. 1,331.7 -181A! 1,235.1 1,0.5.1 -230.0 1,311.0 1.617.1. - 303.1. 6) Merchandise SaiS5 651.1 230.1. 1,032.2 686.0 31.6.2 9109.1. 781.0 128.4 972,2 885.6 86.6 1,033.2 986.3 1.6.9 1,087.1 1,098.8 11.7 11) No-smoe.t.ar gold -- 6.3 - 6.3 -- 9.2 - 9.2 --- 6.0 - 6.0 --- 8.0 - 8.0 --8.0 - 8.0 --9.0 - 9.0 iii) Freight and insurance 20.1. 78.7 -58.3 22.2 77.6 -51.41 25.3 83.7 -50.0 20.2 100.1 -71.9 37.0 lll.1 74..1 1.2.0 121.2 - 82.2 iv) Ic-teeonet incane 9.0 i6o.6 -151.6 15.7 151.2 -135.5 7.5 Th8.6 - 41..9 110.0 -11..0 156.L - lEAL 171.1. -171.1. T-nte ... t P.Y-.t1.5.1. 50.7 -56.8 5 u.o 51.1. 55.1. (a (cerestin -o (1.5.4) (50.7) (56.8) (-56.0) (- 5.3) (-39.1. (nessoas (-)C-)(-)( -- ) ( 6.1) (16.0) (h) Other 106.2 -81.86-81. 91.. - lo.o -11ie_ Tra~~~~~~~~~~~~el 39.8 ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ . 2 c - 13 65.0 60 - 1.8.0 71.0 9.0 .4 Travel 38.8 1.~~~~~~~~~~3.8 - .0 .5.,8 58.7 12.Lo 52 7 00. - 5. r3 b- -1. 660-0 8. vi) oithr transportation 1.2.5 4.1.2 1.3 1.5.1. 12.6 2.8 31..8 1.5.7 -10.9 39.6 50.0 - 10.L 1.1.9 53.0 -11.1 1.1.9 57.0 -12.1 vii) Ganernsant n.ie. 9.1. 16.3 - 1.9 10.6 21.0 -13.1. 12.2 21.3 -12.1 13.,0 25.0 .11.0 15.0 25.0 -10.0 16.o 25.0 - 9.0 viii) Other 36.9 50.8 -13.9 10.7 56.5 -13.8 1.1.6 55.0 -13.1. .2.0 57.0 -15.0 L3.0 59.0 -16.o 16.2 61.o i?1.0 2. Tranfers 2u 1.2 .)).±.2 91.8 1.6 90.2 1.1.2 2.1 39.1 30.0 25.0 25.0 i) Private 4..9 --- 1..9 15.2 --- 15.2 8.3 --- 8.3 hi) Central go,erneet 27.6 1.2 26.1. 76.6 1.6 75.0 32.9 2.1 30.8 (A) Balnc on Currnt Account 26.1 199.5 -80.1 -151.14 205.0 278.1. (B) Capital Account 1. Private Longz-ters 56.9 ~ 10.1 1.2.9 123.1. 80.6 51.3 1.7.0 7,3 102.5 33.5 59.0 113:5 30.0 81..5 11.9. 5 0 11..5 i) Direct inveetn..ct 11.2 57.7 -16.5 27.6 27.0 0.6 39.6 21..! 15.2 00.6 21.1. 56.2 ii.5 30.0 81.5 169.5 35.0 ILL. 5 ii) M ltoalloattnc, -- --- --- -- 71.2 -71.2 --- --- --- -- -I -- -- - iii) Other 15.7 9.3 6.1. 15.2 25.2 - 10.0 i1..7 226 ?.79 219 9. 28 2. Public and Public Guaratee 221.5 96.5 130.0 ZJ.7 125.5 100... 179.1 11..6 2 171. 117.1. 26.9 232.6 178.5 54..1 261.1 157.3 103.8 a) Existing loans 221.5 91.5 130.0 151.7 125.5 29.2 179.1 11.8.6 30.5 119.6 11.7.1. 27.8 96. 1 173.5 -771. 58.3 14.2.8 - 4. i) Ceotral gover.sant 121 .3 1..9 77 .!, 95.3 77.3 i8.l 112.8 113.3 1.0 99. 111.1 - 13.0 81. 1 129.7 - 18. 6 56.9 95.3 - 38.1. (Refinancing) (60.9) C2.1) (58.8) (29.7) (22.1) C7.3) (28.6) 4 11.5) 32 .9) C1.3) ( 19.1) C-17.8) &-) 176.1) 1-76.1) (- 50.2) 1-50.2) ii) Deceotra3lned cgcrcn ;.- in . - . , , ~ 2. 1.3 - 55 71'-.5 5 2. '. -o'u I. 1.oo2 .0 4.6 ii!Priv-, gonr-t,., 7.3 51 . 2 ) : 0.2 6.1 C. .7 3.0 .o 2.5 5. - 5.5 b) L....na ---i 1' -- --88.' -- - . - "'Tb -.,~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ 35. 10 30.0 5. Utllnance3 ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~OO.431~3. Table 3.3: COMMODITY EXPORTS, 1969-74 (US$ million) Projected 1969 1970 1971 1972 1973 1974 Copper Volume ('DD3 m tons) 200.8 212.3 212.6 216 238 245 Unit value (#/lb.) 59.9 52.5 41.6 40.o 41.5 43.0 Value 265.2 245.7 195.2 190-4 217.7 232.2 Iron ore Volume ('000 lr) 9,4Y. 9891. 84h5) 9,65i 10,200 10,200 Unit value (W/LT) 7.42 7.21 7.20 7.20 7.20 7.10 Value 70.1 71.3 60.8 69.5 73.4 72.4 Lead Volume ('000 m tons) 156.2 162.0 154.7 171.0 186.0 196.0 Unit value (#/lb.) 10.06 9.89 8.35 9.20 9.40 9.60 Value 34.6 35.3 28.5 34.7 38.5 41.5 Zinc Volume ('000 m tons) 310.4 334.1 328.3 341 360 400 Unit value (¢/lb.) 6.26 6.94 6.46 7.20 7.60 8.0o Value 42.8 51.1 46.8 54.1 60.3 70.5 Silver Volume ('000 kg) 1,080.6 1,178.0 997.0 1,220.0 1,358.0 1,422.0 Unit value (¢oz.) 168 165 154 170 190 21D Value 58.5 62.4 49.3 73.0 90.8 105.1 Fish Meal Volume ('000 m tons) 1,656 1,873 1,672 1,800 1>800 1,800 Unit value ($/m ton) 122.08 162.05 156.82 155.00 150.00 150.00 Value 202.1 303.5 262.2 279.0 270.0 270.0 Other fish products Volume ('000 m tons) 160 218 266 29,J 310 330 Unit value (/r/m ton) 109.h44 198.24 203.02 165.00 165.00 165.00 Value 17.5 43.2 54.D 47.8 51.2 54.5 Cotton Volume ('000 m tons) 96.8 72.8 63.0 67.2 70.8 71.1 Unit value (#/lb.) 31.4 30.4 34.4 34.2 32.6 31.3 Value 66.9 52.1 47.8 50.6 50.9 49.0 Sugar Volume ('000 m tons) 268 403 401 400 400 430 Unit value (Wlb.) 6.7 6.7 7.1 7.3 7.5 7.8 Value 39.5 59.7 62.8 64.4 66.1 68.8 Coffee Volume ('000 m tons) 43.2 44.0 43.1 44.0 45.0 48.( Unit value (&ilb.) 32.80 45.10 4o.02 410.00 40.00 430.00 Value 31.2 43.8 38.0 38.8 39.7 42.3 Wool Volu:ne (m tons) 6.7 2.1 1.5 1.5 2.0 2.5 Unit value ($/m ton) 1,235.00 1,558.00 1,721.00 1,734.00 1,750.00 1,765.00 Value 8.6 3.3 2.6 2.6 3.5 4.4 Other exports (value only) 44.4 61.9 61.5 66.1 71.1 76.4 TOTAL EXPORTS 881.5 1,032.2 909.4 972.2 1,033.2 1,087.1 Source: Central Bank, Mission estimates Table 1.4: INTERNATIONAL RESERVESI/ (in millions of us$; end December) 1969 1970 1971 Gross Reserve 267.0 495.7 451.8 Net Reserves 151.6 410.1 339.6 1/ Assets in foreign currency of the banking system (Central Bank, Banco de la Nacion, commercial and savings banks and specialized banks). Source: Central Bank of Peru, Nota Semanal, January 20, 1912. Provisional Table 4.1: PERU - EXTERNAL PUBLIC DEBT OUTSTANDING AS CF DECEMBER 31, 1970 Debt Repayable in Foreign Currency (In thousands of U.S. dollars) Debt Outstanding December 31 1970 Source Disbursed Including only undisbursed TOTAL EXTEPNAL PUBLIC DEBT 84472 187,01 PRIVATE BANKS 124,23 124 774 CAnada 17,642 17 2 France 1,609 2,148 Germany (Fed. Rep. of) 4,310 4,310 ItRly 1,053 1,053 Japan 340 340 United Kingdom 2,001 2,001 TJSA 97,280 97,280 PRIVATELY PLACED ONES 4 168 4 168 US.A > l OTHEP. PRIVATE FINANCIAL INSTITUTIONS 22,439 25,465 Spain 6,5 n 9,597 TJSA 11,193 11,193 Venezuela 4,400 4,4oC Multiple Lenders 275 275 PUBLICLY ISSUED BONDS 19 904 19 90h, Uniled Kingdom 5,20 USA 11,376 14,376 SUPPLIERS 3001412 " 61 Auvitria 1,133 1,333 Belgium 11,973 13,073 Canada 20 3,003 Finland 26,618 26,618 France 13,125 15,704 Germany (Fed. Rep. of) 52,142 52,393 Israel 372 372 Italy 114j,822 '.48,845 Japan 38,084 57,860 Netherlands 354 354 Spain 20,984 20,984 Switzerland 1,179 1D7I18 IJnitqd Kingdom 3,36,3 3, J63 USA 16,243 16,744 - 2 - Provisional Debt Outstanding December 31, 1970 Source Disbursed Including LOANS FROM INTERNATIONAL ORGANIZATIONS 143 686 214,076 IERD 124,61 183,252 IDB 19,055 30,824 LOANS FROM GOVERNMENTS 197 902 268,453 Argentina 65,257 Belgium 10,467 10.467 Canada 10,631 11,949 Denmark 3,049 3,332 France 8,896 17,310 Germany (Fed. Rep. of) 62,418 80,856 Netherlands 994 994 New Zealand 2,910 9,677 United Kingdom 1,670 2,059 USA 90,610 125,552 UNCLASSIFIED 61,726 167,840 Note: Debt with a maturity of over one year. Economic and Social Data Division Economic Programs Division December 9, 1971 Provisional Page 1 Table 4.2: PERU - ESTIMATED FUTURE SERVICE PAYMENTS ON EXTERNAL PUBLIC DEBT OUTSTANDING INCLUDING UNDISBURSED AS OF DECEMBER 31., 1970 Debt Repayable in Foreign Currency (In thousands of U.S. dollars) DEBT OUTSTANDING BEGINNING Of PIRIOD TRANSACTIONS DURINO PgRiUD DISBURSED INCLUDING 6EflVIC PAVN&NT YEAR ONLY UNDISBURSED PRINOIPAL wNiR8E&? OTAL TIOTAL EXTERNAL PUBLIC DEBT 1971 874,472 1,187,041 159,433 54L,141 213,57 4 1972 874,607 1,026,184 .148,159 49,664 197,523 1973 821,240 881,205 170,557 44,722 215,279 1 974 63h.,1251 714,282 1140,229 37,741 177,970 1975 549,8o i77,092 109,094 30-,217 139,311 1976 h68,078 475919k 67,494 25,909 93,403 1977 384'026 3865114 4*o402 2ax343 640TO5 1978 347'S59 350#000 37D690 20o633 51D0Q1 1979 289'3?9 290597T 360509 190151 S2D600 1980 ?256682 257.8T4 32DI98 1B0511 botVo 1981 224#?28 2255771 27#635 16a463 400O@ 1982 197#094 1905136 2§D449 11D723 D5pAZA 1983 173,646 174;688 20.150 9.309 29$D$9 1984 153'496 154i530 19OB99 6AS, 860401 1985 134.597 134i639 10#602 SOM aaDt3 1986 118.915 118b957 1S2851 4603 17o524 198V 106.065 1060106 10993 4D106 150O09 1988 95.073 9S5113 P.961 3Z599 63P30Q 1989 85D112 857152 COS7 DOa35 a o6D2 1990 76.356 6#.396 8.994 710I a1D7 2 1991 670362 67402 5o960 20319 soggy 1/ Provisional; the estimate in the Balance of Payments amounts to US$205- Note: Includes service on all debt listed in Table 1 prepared December 9, 1971. Provi,i onzal Page 2 Table 4.2i PERU - ESTDIATED FUTURE SERVICE PAY1i,JTS ON EXTERNAL PUBLIC DEBT OUTSTANDING INCLUDING UNDIbBURSM AS OF DECE3BER 31, 1970 Debt Repayable in Foreign Currency (In thousands of U.S. dollars) DEBT OUTSTANDINU TANSACTIONS DURING PERIOD BEBINNING oF PCRIOD DISSURSCE INCLUDING SERVICE PAYMENTS YEAR ONLY UNDISBURSED PRINtIPAL INTIREST TOTIL PRIVATE BANKS 1971 124,235 1240774 22a822 11,436 34,329 1972 102'086 102.*086 25,474 9,294 32#768 1973 78#612 76A612 4,t81t 6,781 49D597 1974 350795 35A795 &9,815 3#069 22P884 1975 15.980 15i980 )5a237 1I088 16.335 1976 743 743 337 55 392 1977 406 406 388 22 410 1978 18 18 18 1 19 Provisional Page 3 Table 4.2: PERU - ESTf24ATE FUTURE SERVICE PAYMENTS ON EXTERNAL PUBLIC DEBT OUTSTANDING INCLUDING UIIISBURSEB AS OF DCECaBER 31, 1970 Debt Repayable in Foreign Currency (In thousands of U.S. dollars) DEBT OUTSTANDING TRANSACTIONS DURING PIRIOD BEGINNING or PERIOD DISBURSED INCLUDING SftVICE PAYM6NTB YEAR ONLY UNDISBURSCD PRINCIPAL lXtlI68T TOM PRIVATL BANKS CANADA 1971 17#642 17i642 20275 1.652 3P987 1972 15.367 15i367 *0408 1.409 40O5 1973 11.959 11M959 6*6,6 1.020 rtA 1974 5.263 5.263 20996 hS2 304&O 1975 20267 21267 2.26? 151 2o066 PRIVTE BANKS FRANCE 1971 1.609 2b148 714 21 920 1972 1.434 1D434 451 131 502 1973 983 903 320 102 482 1974 663 663 464 52 596 1975 199 199 199 6 205 Provisional Page 4 Table 4.23 PERU - ESTl4ATED FiUTURE SERVICE PAYI{ENTS ON EXTERNAL PUBLIC DEBT OUTSTANDING INCL,UDING LTDInIBURaSi AS OF DECEMBER 31, 1970 Debt :Repa-yable in Foreign Currency (In thousands of U.S. dollars) DEBT OUTSTANDING TRANSACTIONS DURING PERIOD StGINNINQ o0 PERIOD DISBURSED INCLUDING SERVICL PAYMINTS YEAR ONLY UNDtSSURSEO PRINI$PAL INTIREST TOTAL PRIVATE BANKS USA 971 97P280 977280 14i756 9,032 23#768 972 82#524 820524 18#832 7,523 26#355 .973 63#692 631692 3%#240 5,489 400729 .974 2SA452 28k452 LOQ019 29445 18*4S3 .975 12i434 12o434 12i434 843 13P277 Provisional Page 5 Table 4.2: PERU - ESTUl4ATED FUTURE SERVICE PAY14ENTS ON EXTERNAL PUBLIC DEBT OUTSTANDING 5ICLUDING UNDISBURSED AS OF DECZIDER 31, 1970 Debt Repayable in Foreign Currency (In thousands of U.S. dollars) DEBT OUTSTANDING TRANSACTIONS OURING PEROD BEGINNIN OFr PERIOD DIS8URSED INCLUDING SERVICE PAVMENTj YEAR ONLY UNDISSUI,. _., NPAL INT9 v? VOTML PRIVAtt SANKS BORNANY CtCO*RIEP0!.O) 1971 4A310 4131Q 42444 252 4G696 PRIVATL BANKS JAPAN 1971 340 3qa 62 21 83 1972 278 278 62 17 79 1973 216 216 50 1! 03 197A 166 166 31 10 47 1975 129 129 37 a as 1976 92 92 37 5 32 1977 55 55 3? 30 1978 is 1 18 t 19 Provisional Page 6 Table 4,21 PERU - ESTD4ATED FUTURSE-SRVICE PAY-n;NTS ON EXTERNAL PUBLIC DEBT OUTSTANDING NCLLMDING UNDISBURSD AS OF DEC2EPER 31, 1 970 Debt Repayable in Foreign Currency (In thousands of U.S. dollars) DEBT OUTSTANDING TRANSACTIONS DURING PERIOD BEGINNING O0 PERIOD DISBURSED INCLUDING SERVICE PAYMpNTS YEAR ONLY UNDISOURSED PRINCIPAL INTEREST TOTAL (2A '1l. 6)(7 Cl) (;PRIVATE BANKS ITALY 1971 10053 11053 421 78 499 1972 632 632 421 43 405 1973 211 211 211 9 219 PRIVATE BANKS UNIT[D KINGDOM 1971 2e001 2D001 150 I8S 338 1972 1'851 1W851 300 170 470 1973 1,551 1551 300 140 440 1974 1251 16251 300 110 410 1975 951 951 300 80 360 1976 651 652 300 50 310 1977 351 351 351 19 370 Provisional Page 7 Table 4v.2s PERU - ESTIMATED FUTURE SERVICE PAY1;NTS ON EXTERNAL PUBLIC DEBT OUTSTANDING INCLUDING UNDISBURSEI AS OF DECEIMER 31, 1970 Debt Repayable in Foreign Currency (In thousands of U.S. dollars) DEBT OUTSTANDING TRANSACTIONS DURING SIRIOD sEGINNING or pERIsD DISBURSED INCLUDING SERVICE PAYtMNT6 YEAR ONLY UNDISIUUSED PRINSIPAL iNtEAtsT TOTBL PRIVATELY PLACED BONDS USA 1971 4.168 4160 Sb 160 242 4o480 Provisional Page 8 Table 4.2, PERU - ESTfl4ATEI FUTUE-'3ERVICE PAYMEITS ON EXTERNAL PUBLIC D2T OUTSTANDING INCLIDING UNDISBURSED AS OF DECMBER 31, 1970 Debt Repayable in Foreign Currency (In thousands of U.S. dollars) DEBT OUTSTAI40DI4 TRANSACTIONS DURING PCR1OD BEGINNING OF PERIOD DISBURSED INCLUDING 3ERVICE PAYMNNTS YEAR ONLY UND3SSURSED PRINCIPAL INTIRET TOTAL Cl) (2) Cs) (6) Ct) OTNER PIRIVATE rINANCIAL NISTs 1971 22,439 2S5.465 £9226 1, 156 4a313 1972 20*890 d?22239 50198 19150 4#348 1973 19*041 fl9%041 5.7O8 999 476a7 1974 15#253 1l5#253 5.567 799 5.386 1975 10#686 10b686 2,354 571 2'925 1976 8.332 0B332 1A522 416 1,098 197? 6.810 6I810 668 327 995 1978 6.142 6A142 668 290 958 1979 5.474 5b474 666 253 921 1980 48s06 40806 668 217 885 1981 4.138 4h138 668 179 Bi7 1982 3.470 3 O470 668 142 810 1983 2P802 2b802 608 106 774 1984 2.134 2b134 668 69 ;37 1985 1D466 ID466 668 31 699 1986 798 798 588 2 590 1987 210 210 210 210 Provisional Page 9 Table 4.2: PERU - EST2ATED FUTURE 3ERVICE PAMNTS ON EXTERNAL PUBLIC DEBT OUTSTANDING INCLUDING UNDISBURS3I; AS OF DECFMBER 31, 1970 Debt Repayable in Foreign Currency (In thousands of U.S. dollars) DEBT OUTSTANDING TRANSACTIONS DURI%% PARIOD BEGINNING or PERIOD DISBURSED INCLUDING SERVIC& PAt4E6Ta YEAR ONLY UNDISBURSED PRINBIPAL INTIRM6T TOM Cl) C2) (Oki Cob u) OTHER PRIVATE FINANCIAL 1MST. SPAIN 1971 6#571 9i597 900 559 1D409 1972 7,348 Bi697 1*3)8 634 1P@2 1973 7,359 71359 2,020 520 2DS#4 1974 5P339 5i339 2*799 3II 3po1& 1975 2*540 2#540 i,686 10 FID056 1976 854 854 854 51 905 OTHER PRIVATE FINANCIAL INSTo NSA 1971 11*193 111193 1,043 576 tp6t9 1972 10*150 10i150 668 512 SP&80 1973 9,482 9*482 668 475 1D013 1974 8#814 8b814 668 438 1106 1975 8*146 86146 668 401 1S009 1976 7*478 7h478 668 365 1D0o$ 1977 6*810 6iB10 a668 2 95 1978 6*142 6*142 668 290 ego 1979 5*474 51474 668 253 921 1980 4*806 4j806 668 217 865 1981 40138 4'138 668 179 06 1982 3*470 34470 668 142 0%0 1983 2*802 2i802 668 106 774 1984 2,134 2)134 668 69 is 1985 1#466 1i466 668 31 609 1986 798 798 588 2 SDO 1987 210 210 210 210 Provisional Page 10 Table ..2s PERU - ESTIMATID FUTURE SERVICE PAYTIENTS ON EXTERNAL PUBLIC DEBT OUTSTANDING flMCLUDING UNDIS6BURSIR AS OF DECEMBER 31, 1970 Debt Repayable in Foreign Currency (In thousands of U.S. dollars) OCI? OUTSTANDINGTAWCTOBORIGpRO BEGINNING Of PERIOD TRANSACTION DURINQ PIRIOD DISBURSED INCLUDING SERVICL PAY^tNTS YEAR ONLY UNDIZSUSSCD PRINBIPAL INTERUT TOTAL cs~~~& (5ci ) (7) OTHER PRIVATE FINANCIAL INSTs VENIZUELA 1971 4A400 4 D400 *DlOO m a l@ 1972 30 3OO 3.300 6, 1 00 a 1 £ OO 1973 2,200 2i200 1.100 a 1II00 19?4 1.100 14100 1*100 * 1 co OTHER PFRIVATE FINANCIAL INGT. MIJLTIPLB LENDERS L971 275 2T5 183 22 205 1972 92 92 92 4 96 Provisional Page 11 Table 14.2s PERU - ESTIMATEB FUTURM SERVICE PA=TS ON EXTERNAL PUBLIC DEBT OUTSTANDING INCLUDING UNDISBURSIE AS OF DECEIEIBER 31, 1970 Debt Repayable in Foreign Currency (In thousands of U.S. dollars) DEBT OUTSTANDING TRANSACTIONS DURaNI P6R^0D BEGINNING OF PERIOD DISBURSED INCLUDING SERVICE PAYMGNTA YEAR ONLY UNDISSURSED PRIN$BPAL INtOR6Bf TQ6 Cl) V PWBLICLY ISSUED BONDS 1971 19,904 19;904 69189 5?3 3 0? 3 1972 16#7i5 16AT15 3*286 4r7 37R@3 1973 13#429 13D429 $*385 376 3D7 a 3 1974 10J044 100044 sD481 275 3Dt 3 1975 6,557 6A557 2Dl6? ItO 2D317 1976 4#390 4*390 249 130 370 1977 4s141 4i1*1 256 122 aFe 1978 3#885 3B885 26* 11S lYe 1979 3#621 3o621 272 107 7n 1980 3#349 3k349 280 9B M0 1981 3D069 3h069 289 90 3'Q 9 1982 2t781 25781 297 el 3 F 1983 2P483 2h483 306 7? 3?9 1984 2177 2il?? 316 6b Z70 1985 1#861 11861 200 53 39fi> 1986 1#582 1h582 24Z 46 202 1987 1I335 1i335 254 30 POa 1988 11081 lbOSI 262 30 292 1989 819 819 270 23 202 1990 549 549 278 14 22 1991 27l 271 271 6 27r Provisi onal Page 12 Table 4.22t PERU - ESTIMhATM FUTURE aESRV:ECE PAYE={2WS ON E£TERNAL PUBLIC DI-BT ~- OUTSTANDING INCLUDING UNDItTBURIM AS OF DECESSiR 31, 1970 Debt Repayable in Foreign Currency (In thousands of U.S. dollars) DEBT OUTSTANDING TRANSACTIONS DURING PERIOD BESCNNING or PERIOD DISBURSED INCLUDING SERVICE PAYMENTS YEAR ONLY UNDISBURSED PRIlkSPAL INtEREST TOTAL CI) (2) (s) CT) PUBLICLY ISSUED BONDS U6A 1971 14'376 141376 te975 409 3,384 1972 11P401 11e401 5,065 319 3,384 1973 8*338 8i336 3#158 227 3#3S4 1974 5#178 5b178 3P253 131 3i354 1975 1P925 1 925 1,P925 33 l a8 PPBLICLY ISSUED BONDS UNITED KXNGDOM 1971 50528 5*528 214 164 379 1972 5P314 5D314 221 158 379 1973 5*093 5h093 227 151 379 1974 4*866 4b866 234 144 379 1975 4F631 4D631 241 137 379 1976 4J390 4$390 249 130 379 1977 40141 4,141 256 122 379 1978 3'885 3b085 264 1lS 379 1979 3'621 32621 272 207 379 1980 30 349 30349 280 98 379 1981 3#069 3i069 289 90 379 1982 2P481 2*7e8 297 81 379 1983 20483 2s483 306 72 379 1984 2s177 2W177 316 63 379 1985 1i861 1. 861 280 53 333 1986 10582 1i582 247 46 292 198?7 1335 1t335 254 38 292 1988 1.081 1081 262 30 292 1989 819 819 270 23 292 1990 549 549 278 14 292 1991 271 271 271 6 277 Provisional Page 13 Table 1&.2: PERU - ESTl4ATED FUTURE SERVICE PA=TS ON EXTERNAL PUBLIC DEBT OUTSTANDING INCLUDING UNDI5BURSED AS OF DECEMBER 31, 1970 Debt Repayable in Foreign Currency (In thousands of U.S. dollars) DEBT OUTSTANDINN TRANSACTIONS DUR0NG B6RzOD BEGINNING Of PERIOD DISBURSED INCLUDING SERVICL PAYtMNTS YEAR ONLY UNDISSUISED PRINUIPAL INtlRO6T TOTAL (1) (2) C5 Ce) SUPPLIERS 1971 300*412 362#361 51.033 14,511 65,544 1972 299P435 313*012 46#903 12.629 5905S2 1973 261*993 26TA*88 56i616 13#254 63D8n0 1974 218*056 219*056 41*919 11A399 58D32g 1975 173*204 174#204 32*892 9*821 42*713 1976 146.799 14N7.99 25*4?? 10*160 38O63O 1977 99*047 1006047 26*433 9* 1G1 0'o6t4 1978 82*861 83*861 16D642 9D331 25A974 1979 44*050 45*050 11*618 OA449 20D06? 1980 32*432 33*432 11*632 pB43 2o0475 1981 20,800 216800 9.766 N7r30 f JD496 1982 11*034 12i034 S$463 3*838 9.301 1983 S*571 6W571 5*388 2*358 5D746 1984 2#184 3kl&4 3.184 329 3GSa3 Provir,ion;l Page lL Table 4.2a PERU - ESTIMATIM FU1JTUR.2 S3ERVICE PAYIMaMTS ON EXTERNAL PUBLIC Dl;T OUTSTANDIN INCLUDDING UNDISBURSE1 AS OF DECIEMrR 31, 1970 Debt Repay-able in Foreign Currency (In thousands of U.S. dollars) DEST QUtSTANDINS TRANSACTIONS DURING PLRIOD BEGINNING or PERIOD OISBURSED IkCLUDING SERVICl PAYMENTS YEAR ONLY UNDISSURSCD PRINCIPAL iNtIkRET SUPPLIERS AUITRIA 1971 10133 1333 42? 76 503 1972 842 906 428 52 440 1973 478 478 234 37 271 1974 245 245 82 17 99 1975 163 163 25 12 37 1976 1)8 130 25 10 65 L977 113 113 25 8 B3 1978 86 a8 25 6 I1 1979 63 63 25 4 29 1980 38 38 25 2 27 l981 13 13 13 a 13 Provisional Page 15 Table 14.2: PERU - ESTlIATED FUTURE SERVICE PAYMENTS ON EXTERNAL PUBLIC DEBT OUTSTANDING INCLUDING UNDISBURSIM AS OF DECEMBER 31, 1970 Debt Repayable in Foreign Currency (In thousands of U.S. dollars) DEBT OUTSTANDING TRANSACTIONS DURING PSRIOO BEGINNING OF PERIOD DISBURSED INCLUDING SCRVICg PAYEWNTS YEAR ONLY UNDISBURSED PRINCIPAL INtIREST TOTGL SUPPLIERS ILLGIUM 1971 11#973 13$07) 3.006 904 3.9f0 1972 10.121 10)121 3#247 O85 3P982 1973 6#874 6ke?4 5.606 446 4,0X2 1974 3.268 3i268 2,002 IN 2.178 1975 1,266 1W266 230 8s 315 1976 1.036 11036 230 68 209 1977 806 806 230 52 263 1978 576 576 230 36 256 1979 345 345 230 20 250 1980 115 115 1t3 4 119 Provisional Page 16 Table 4.2: PERU - ESTIM4TM FUTURS- SERVICE PAYI{NTS ON EXTERNAL PUBLIC DEBT OUTSTANDING INCLUDItNG UNDISBURSIE AS OF DECZIBER 31, 1970 Debt Repayable in Foreign Currency (In thousands of U.S. dollars) DtET OUTSTANDING TRANSACTIONS DURING PIRIOD OIBtZNNIN OT IpgmIOD DISBURSED INCLUDING SERVICE PAYMENTS YEAR ONLY UND?SSUISCD PRINfIPAL INTEREST TOTAL SUPPLI US CANADA 1971 20 34000 1 1 1972 1.220 )D,0ooO 110 11o 1973 2.420 3,000 400 235 615 1974 2.600 2?600 400 225 625 1975 2s200 2.200 400 189 559 1976 lD8O0 11*8O0 400 153 553 1977 1,400 1t400 400 117 517 1978 1S000 11000 400 Wi. 401 1979 600 600 400 45 445 1 980 200 200 200 9- 209 Provisional Page 17 Table 4.2: PERU - ESTIMhTI;D FUTURE SERVICE PAYINTS ON EXTERNAL PUBLIC DEBT OUTSTATDING INCLUDING UNDISBURSED AS OF DECEMBER 31, 1970 Debt Repayable in Fbreign Currency (In thousands of U.S. dollars) DEBT OUTSTANDING TRANSACTIDNO DURINOG RRIOD BEGINNING OF PERIOD DISBURSED INCLUDING SERVICS PAYMENTS YEAR ONLY UNDtSOURSED PRINCIPAL INtURST TOTAL Cl) t2) '^} tha 6L) SUPPLIERS FINLAND 1971 26#618 26i618 4.78 1Do362 5D540 1972 22.440 22.440 l9o0o 1#126 5A01 3 1973 18.S33 181533 lo643 924 49at6 1974 14.890 147890 3i623 731 403S4 197$ 11#26? 11.267 5.622 542 XD014 1976 7r645 7.645 3.623 351 3 9r4 1977 4.022 0022 20759 162 2a@2 1978 1.263 1.263 2#263 50 aP96 SUPPLIERS FRANCE 1971 13.125 155704 1.125 e98 GDOa3 1972 10.579 100579 5*210 73 AP0O9 1973 9.146 95148 5A947 628 4,DW 1974 6.984 6&984 8W533 482 spoaZ 1975 4.518 41516 4AT49 310 508T 1976 2.003 21003 1.056 148 1.204 1977 651 651 *^917 10 2,99t 1978 350 350 15.053 29 14D008 1979 219 219 143 1? goo 1980 76 76 76 4 s8 Provisi.cnal Page 18 Table 4,.2s PERU - EST24A'rEM FUJTURZ 3ERVICE PAYMThITS ON EXTERRNAI PUBLIC DEE3T OUTSTANDING ThCLUI)ING UNDISBURSID AS OF DEC fBLR 31, 1970 Debt Repayable in Foreign Currency (In thousands of U.S. dollars) DEST OUTSTANDING TRANSACTIONS DURING PERIOD BEGINNING Or PERIOD DISBURSED INCLUDING 5fDVteE P'YMENTA YEAR ONLY UNDIS6URSED PRINCIPAL INTEREST TOT&L §UPPLIERI GomRMANY CtEDoREPsOF) 1971 52*142 52,393 1?003S 3,029 20#064 1972 36D982 36i982 10.940 10995 16.915 1973 22*042 221042 12911 .0095 14.006 1974 9#132 9*132 9.066 265 9.350 19r5 66 66 66 2 68 Provisional Page 19 Table 4.2: PERU - ESTfl4ATID FUTURE SERVICE PAYME2TS ON EXTERNAL PUBLIC D;T OUTSTANDING INCLUDING UNDISBURSED AS OF DEC3MBER 31, 1970 Debt Repayable in Foreign Currency (In thousands of U.S. dollars) DEBT OUTSTANDING TRANSACTIONS DUf8A ISR8DO BEGINNING or PERIOD DISBURSED INCLUDING BERVICL PAYMINTS YEAR ONLY UNDISSURSID PRINCIPAL INMARMT TOTAL SUPPLItRS ISRAEL 1971 372 372 186 60 246 1972 186 186 106 T4 2t0 SUPPLIER& ITALY 1971 114.822 1481845 5216 3.556 7.772 1972 133.629 144D629 6a30a 4a141 A0P349 1973 133.321 138A321 11.231 7,052 10D2O3, 1974 1250090 126b090 10.132 ?P428 21,0 1975 110.958 111958 15o362 ?,592 2VO94 1976 99.849 100i849 13,345 8.836 22aoW 1977 88.906 89.906 11h743 6.628 20P373 1978 780490 79.490 268197 9P0?77 lDt°91 1979 42.309 43*309 10.734 8.332 6f9D046 1980 31.575 32ASTS 11.130 Wee tepeeo 1981 20.445 211445 9.660 YA?Q &7440D 1982 10#777 ili?r? Sb? 3.8II23 9D200 1983 5400 6b400 09302 2*3480 5 o 1984 2.098 37098 0/096 324 30 h2 Provisional Page 20 Table 4I2Z PERU - EST1I;ATEM FUTURE SERVICE PAYI{E3TS ON EXTE.INAL PUBLIC DEBT OUTSTANDING INCLUDING UNDI6BURSED AS OF DECEMBE3R 31, 1970 Debt Repayable in Foreign Currency (In thousands of U.S. dollars) Ot5Y OUTSTANDING TRANSACTIONS DURING PERIOD BEOINNING OF PERIOD DISBURSED INCLUDING SERVICE PAYmENT6 YEAR ONLY UND16SUR6[D PRINBIPAL INTURESt TOTAL (O) (2) CS (6? C?) SUPPLI RS JMPAN 1971 380084 57.860 17,31 1,759 2,490 1972 49.719 50s129 6.152 1.426 7.578 1973 43.770 43917T 8cB41 1.173 68014 1974 37.137 37bl31 6*527 770 7,207 1975 30.610 300610 6.088 445 40553 1976 260522 26b522 t.934 203 2#157 1977 509 509 336 28 364 1'978 173 17F3 173 6 179 STUPPLIERS NETHERLANDS 1,971 354 354 240 18 258 1 972 120 12D 120 4 124 Provisional Page 21 Table 4.2: PERU - ESTTDhATED FUTUR2 S3ERVICE PAY1{NTS ON EXTERNAL PUBLIC DEBT OUTSTANDING INCLUDING UNDISBURSIE AS OF DECEIZER 31, 1970 Debt Repayable in Foreign Currency (In thousands of U.S. dollars) DEBT OUTSTANDtNG TRANSACTIONS DURING PBRLOD BEGINNING O PERIOD DISBURSED INCLUDING SERVICE PAYMENTS YEAR ONLY UNDISSURSED PRINCIPAL INttElgE TOTgL SUPPLIERS SPAIN 1971 20#984 20i904 1,544 1.132 4P676 1972 17P440 17.440 3*669 952 4D6t1 1973 13#771 13.771 5.344 699 4D083 1974 10#427 10A42? 3#344 507 3o'ia 1975 7.08) 71083 2#69? 324 3o021 1976 4D 386 4A386 3.344 190 2#564 1977 29042 2iO42 2A042 74 2s116 SUPPLIERS OWE T1ERLAND 1971 101?9 1718 930 49 979 1972 465 788 315 31 345 1973 367 475 15t 30 102 1974 323 323 too 24 1a 1975 216 216 108 1a 123 1976 108 10 to0 o 7 4 Provisiornal Page 22 Table 4.2t PERU - ESTIMhATE FUTURiE S3RVICE PAY121TLJ ON EXTERNAL PUBLIC DET OUTSTANDING INCLUDING UNDISBURB1D AS OF DECE1I3BR 31, 1970 Debt Repayable in Foreign Currency (In thousands of U.S. dollars) DEBT OUTSTANDING, TRANSACTIONS DURING PgRIOD SCOINNINS OF PERIOD DISBURSED INCLUDING SERVICE PAYMENTS YEAR ONLY UNDISSURS5D PRINCIPAL INTRE.ST TOTAL SUPPLIERS UNITED KINGDOM .971 3D363 3i3-63 581 181 763 .972 2Jr82 2W82 607 149 ?56 .973 2.175 2;175 5?8 115 602 ,974 1.597 Ik597 607 78 664 .975 990 990 219 53 272 .976 771 771 86 46 132 ,977 686 686 86 41 127 978 600 600 86 36 122 .979 514 514 86 31 117 .980 429 429 86 26 lie 981 343 343 86 21 106 982 257 257 86 15 101 983 171 1T1 86 10 96 984 86 86 86 5 91 Provisional Page 23 Table 4.2: PERU - ESTIM4ATED FUTURE SERVICE PAYMENTS ON EXTERNAL PUBLIC DEBT OUTSTANDING INCLUDING UIDISBURSID AS OF DECESBER 31, 1970 Debt Repayable in Foreign Currency (In thousands of U.S. dollars) DEBT OUTSTANDING TRANSACTIONS DURONS PERIOD BEGINNINO or PERIOD DISBURSED INCLUDING SERVICE PAYwINTS YEAR ONLY UNDISIURSED PRINCIPAL imTlSest TOML SUPPLIERS VIA 971 16.243 161744 1634 10A46 50321 972 12P910 12i910 $s615 1l4Al 4A962 9r3 9.094 90094 2.730 820 3.510 974 6.364 61364 2.496 693 3.192 975 3.867 3b866 t#326 243 1*569 976 2#541 2.541 1.326 146 1D414 977 1.215 1b215 693 62 9,5 978 322 322 322 9 351 b~~~~~~~~ ~- " cs t cs P. 9- M 1- CM cS 0 &n-- w4o 0N ft P- M on, M @ o ~ ~ ~~~~~e ""M 4%4%M do " f AN. 4 aq a^oft0 R9 °. o m 14 (ar o- 4a in a o m an w o m _b o o m P. n~~~~~~~~~~~~C P. ft 4,k % ft ft t ft t ft ft ft k ft t ft ft ft ft * r~~~~1-Ac % M. n -C2 10 0 4 NW 401 N 0-0 ( _ .- - IL soN .4 dm O t'1 0 0 P4_ ~~~Z ad 0~~8 C d 30D C O< %O 4t M Q M t_ NO9 C--e 40 Jh N) 1t9 - InweC X~~~~~~~~~~~4 &a am CM a No N 4-a in qg -V cr N. od .4 O% u O 40 C% #X ,nt ~~~~~~~~~~~A QC a0A 4w a zv 43 la -4 NO 0 4 0 v N.C IC 0 qt CD o CM * in N~~~~~~~~a <: CD oh _b Oto Co o D la %n k 41 40 f" P% CM ft -G N rd O .Ss _d CI~~~ C B~ ~ .. >aF ;~~~~~~~e in in rn Cl in qo p- *wS AD, 00 -0 l#S W% O WI Cl $s-t C0__ ;::)I-X < Z ^ O K w r e ^ 4 1 CO O . O e . i N ^ n ¢~~~~ &A l a _ so 44 we we * 4 ea de at s as ol, 40 O" a ^ lai rs~~~~I .5 6 s <~C~~ O gm0cqe r. 9 H fi 9 R~~~~L D' V" Co Co in Oh 4 CM O O de .4 en m -S' C _o tn in CD CD a Ag - at 4 --6 in 'O t"" J-t O - _P. _S % .l%amCMO p ee g~ a ~R le fte Io _-I 4e t" f" 4-- - 4e CDle>E W CJ _ # ~~~~a 9L W emu i 4- 40 ,. - opz C - Ca. x E- : 0 on S a~~~~C -~~~~~~~~~ on a O 9 dO CM O OD W 0 Co W% % le M 4 4: 40 41 4& 4f O O E ~Z Za w>: ezl_Qt@lootJ .:e a,uee b~~ ~ ~ ~~~ ~~~ I% ft Z6 4L ft AL * v 4 t 4% t ft t 4% h ft ft 4L ft v X > " ~~~~~~~o Q f ' - 10 4 * 08 W*n Z^ -C% ff O& W % le go 4 4& D CM tD 4w _ iw^a n le 40 io M 4:> _ cot m lp Ien 4* v on _tC I~~~~~~4~ ~ s C ?d s C -F K. r. o. we eD we @4 we we 04~~~~~~~~> 0 d* . 40 0 s>0 K PoO>0 in __ .0~~~~~~~~~~~~~~~r .1 4 .4 .4 .4 4.4.4 .4 .G 4.4.-4 4.4 .4. w 4 ..4. ca -4 l0C D60 m W." ' we 4 tal e (r Rod a v3Mla E-4C mM9MM .Md " MM Ca " MCC. 40 4ocatez3 p~~~~~~~~~- O- 6ot M: lli0 M ft 10 05 4? me as 13Wh Ci sk 06 1v dV StP o; Cb M D Po 11 ~~ ~ ~~~ ~~~Ee ls z~ eb4 ft cL Q x Q, (4 C& Q6 ex cs CA 42 Cb < 4 4% 4h 4h r- is M 6Lb D 10 Ps:I d - iSP-t 42G c3 ftfCMI 0 a se 4 iH H\ c O ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ - 0_ - .4 U) C\i P O% clD Vo 50 39. e0 4V f 44 0etf 0M4P X.0 M ( ;4 twO la AS *4 -. M P. OLO la: G4 AD WC M As 6 " 0 O: a 42 GIP we < w P. M h- td1 96 CO MU 41 M M cm t A MN P. n aS M a 64 40 CN< 10" co In4 t X~ ~ ~ ~ ~~ ~ ~~~~~~~~W f4 CZ. CA a cxs< Q: ft Qf -Q 44 o a o 4 Z a ro et ob cA ae ¢;~~~~~~~~~~I GM "". g 40 40 0 go S: Ol a0 s aft cs 0 c9 o a 0 Ca M VA SE:~~~c M lo M 0 M M P.-o " v M we a a A P. r0 M- ok A=d " N. _t 4D GOAP Wa 1P 40 O a SX M M *1 IM1 om rn Ca. ~~-4 '~~~ ~ ~ ,. a4 r- t ft 2 N 6i n a o ketc . ** we" 4 ino we * Re^^ to o RZ~~~c OtW ,0 4Sk C30 Q>O C00_ fO& 4 e * V . h * 0 0 _w*440C P~~~V at 5 da o ab i% Do t in Or O% ft w* 4O oh q O~ o O wt v OT Pt f Crm > 2 O oi -A fA ----_d____vaW4W*w4Ow £ 2 :S~~~~~~ z i o Oa4 I. 4 43 40~~~~~~3 E- fi M 41 Za o* in -= o s oo 4 )%o gn m m o) a m m 9. in on o e) EO CM A lO_ i J ^es MZe 0 >o>0 Wo>00 Wv0 _________ _____ ~~~H C z S0t ibota . I s eo o if c EO C\J & A a p ~ ~ ~ ~ ~ ~ ~ ~ ~ ~~mO X z .4' q wII- 4. 0 - %9 _ _ _..4 - o _4 ;-,Xa Od I h~~~~~~~~~~~4 ¢d kn o co J Ok - en c- o "o cm pb % P- wo a s0 O w 40MM o Mo| le" D.* on a la tK - 4~ ft ft *s 4X ft ft ft f A C14 0 Oa~~ = 0 00V N & la 0ev* 1. OP 0 ~ 0 dso as_ a fV eq 4_ _0 _ _ -K C 4t In 10 14 M COI 0 4 CM f" 4W An %O f i r r~~~#~ tr- P. Pl O- II W (a W 40 co G 0 ac goX P f s of M M M M M M M Provisional Page 27 Table 4.21 PERRU - ESTfl4ATED FUTURE SERVICE PAYMENTS ON EXTERNAL PUBLIC DET OUTSTANDING INCLUDING UNDISBURSED AS OF DECE?BER 31, 1 970 Debt Repayable in Foreign Currency (In thousands of U.S. dollars) DE8T OUTSTANDING TRAMQAcTIONS DURING PSRKOD BEGINNING Of PERIOD DISBURSED INCLUDING SERVICL PAYMENTS YEAR ONLY UNDISSURSLE PRINCIPAL INTEREST T0TOL CI) LOAOS PROM BOVERNMENTS C6) 6t) 1971 197.902 2664453 21.198 9.411 30.609 1972 206.821 244'302 21*891 90005 A3o806 1973 196.256 223i813 27.506 uiala s5"324 1974 180.819 198615s 25.181 6g225 34D406 1975 165.008 1704947 25.078 4.89? 39'?76 1976 146.501 j46A510 11.924 3,663 a °587 1977 130.334 1)0k342 sr2: 3.002 11tFRB 1978 121#646 1214656 0.340 2.535 IP1v75 1979 114.151 11441S9 10I005 2.906 12'9t1 1980 104.552 104)560 9.531 2.511 12A0t2 1981 9513r 95JI4*5 6*411 2D187 1OJSO8 1982 86P727 6O634 0l274 1.903 a0.1T 1983 78P453 76i460 4.590 I.634 8A223 1984 71.864 711671 6050 1.0431 70$62 1985 65.813 655820 S.294 1.237 6,51 1986 60.520 60i52? 40421 1,106 5 a 1987 56J099 564101 aFS93 1AQO 40A7o 19a s52.567 52k572 1564 942 306a§ 1989 49,894 494699 1.677 say 3.504 1990 47#216 *?i221 3 i681 83) 3p%53 1991 44#536 44a54L 2*496 T77 3D272 Provisi onal Page 28 Table 4IE2 PERU - ESTI4TI:D FUTUR:E -SRVICE PAYMX3NTS ON EXTIERNAL PUBLIC DEBT OUTSTANDING INCLUDING UNDI8BURSI;D AS OF DECEI$ER 31, 1970 Debt Repayable in Foreign Currency (In thousands of U.S. dollars) DEBT OUTBTANDOISO TRANSACTIONS DURING PERIOD SEBINNINN Or PERIOD DISBURSED INCLUDING SERVICE PAYTENTS YEAR ONLY UNDISIIURSED PRINCZPAL INTLRCST TOTIL Cl) LLDANS FROM QOVERNMENTS BELGIUM4 1971 10*467 10i467 1#560 a1 4#371 19?2 6i959 61959 IA622 552 2J374 1973 5J137 5i137 2P142 395 2#5S7 1974 2D995 2)995 I1674 207 2'081 1975 12122 4ii?? &.122 15 ,197 Provisional Page 29 Table 4.2: PERU - ESTf24ATEM FUTURE SERVICE PAYNTS ON EXTERNAL PUBLIC DEBT OUTSTANDING INCLUDING UNDISBURSED AS OF DECEIBER 31, 1970 Debt Repayable in Foreign Currency (In thousands of U.S. dollars) DEBT OUTSTANDING TRANSACTIONS DURING PIRIOD BEGINNING or PERIOD DISBURSED INCLUDING SKRVIC4 PAYN4NTs YEAR ONLY UNDISOUNSED PRINI1PAL iN?thsT TOTAL CI) LO^N5 FROM BOVERNNMNTS 6) CT) CANADA 1971 10,631 11949 tbIs 11t? 2P295 1972 10.074 lOJ05 2m316 160 2006 1973 9.160 90161 2.316 157 2.*64 1974 8.693 Sf694 2.316 153 2#469 1975 7s348 ?*349 766 143 909 1976 70049 TDOSO 216 129 405 1977 6.944 6;945 2r6 113 390 1978 6P709 65710 290 99 358 1979 7.263 ?b264 290 o? 37r 1980 7.379 78380 290 ?) 543 1981 7?18S 7;186 1st S7 208 1982 70035 TO35 13 03 66 1983 7.022 75O22 13 53 66 1984 7.009 750o9 13 S3 66 1985 6.995 6p995 13 52 66 1986 6.982 61982 13 52 66 1987 6J969 6i969 13 52 i5 1988 6.956 6J956 13 52 65 1989 6.942 6J942 13 12 15 1990 6.929 65929 13 52 5 1991 6.916 65916 13 2a 65 Provisional Page 30 Table 4.2i PERU - ESTDIATlT: FUTURE SERVICE PAYIf{ETS ON EXTERNAL PUBLIC DEBT OUTSTANDING INCLUDING UNDISBURSIM AS OF DECEMER 31, 1970 Debt Repayable in Foreign Currency (In. thousands of U.S. dollars) DES? OUTSTANDING TRANSACTIONS DURING PIRIOD BEGINNING OF PERIOD DISBURSED INCLUDING SERVICE PAYMENTS YEAR OaL,I UNDISBURSID PRINCIPAL INTEREST TOTAL (la LOANS FROM GOVERNMENTS (6) C?) DENMARK 1971 3,049 3.332 - - 1972 3#331 3P332 11' 1* 1973 3#220 30221 222 222 1974 2P998 2i999 222 ' 222 1975 2#776 2;7?7 222 ' 222 1976 2.554 2k55S 222 222 1977 2.331 2b332 222 222 1978 2#109 2b110 222 222 1979 1.887 1*ia8 222 ' 222 1980 1.665 1 666 222 * 22 1981 to443 1,s444 222 * 222 1982 1#221 1h222 222 222 1983 999 113000 222 222 1984 776 77? 222 e 222 1985 554 555 222 222 1986 332 333 222 222 1987 110 111 111 111 Provisional Page 31 Table 4.2t PERU - ESTl4ATEID FUTURE SERVICE PAYI,NTS ON EXTERNAL PUBLIC DEBT OUTSTANDING INCLUDING UNDISBURS1M AS OF DECEMBER 31, 1970 Debt Repayable in Foreign Currency (In thousands of U.S. dollars) DOBT OUTSTANDING TRANSACTtONS DURING PBRIOD BEGINNING or PERIOD DISBURSED INCLUDING SERVICE pAYMCNT5 YEAR ONLY UNDt$SURSED PRINSIPAL iN?CRtSt TOTIL (jI all r t)e" 4' ()) LOANS FROM BOVERNMtNTS T FRANCE 1971 8#896 171310 1.224 975 2D199 1972 16#085 16b086 1,840 1,272 3.112 1973 14#246 14b24? soso0 1.12? 4D207 1974 110166 11b167 4.630 86*4 5,494 1975 6#536 6553? 4#346 490 4DBG6 1976 2#190 2i191 20191 146 2&359 Provisi onal Page 32 Table 4.23 PERU - ESTIMATID UTURE SERVICE PAMTS ON EXTERNAL PUBLIC DIT - OUTSTANDING INCLUDING UNDISBURSEI AS OF DECE13ER 31, 1970 Debt Repayable in Foreign Currency (In thousands of U.S. dollars) DCIt oUTSTANDPNG TRAN8ACTIONS DURING PgRIOD sEsINNING Or PRtIOD DISBURSED INCLUDING SERVICE PAYMENTS YEAR ONLY UNDgSBULSED PRINCIPAL LNtoIfST TOTAL Cl) LOANS FRON GOVERNNENTS (7) GERMANY (IEDORCP&OF) 1971 62.418 80.656 70747 *22552 1972 70.406 T16040 9A294 4.233 13.526 1973 62.855 66b747 13.679 3.527 *7.206 1974 50.919 53i068 13P464 2.518 15#952 1975 39#198 39D604 1&.595 1o643 13.258 1976 28#183 28i.183 0.371 930 7.301 1977 21,396 21.396 10,878 628 250a6 1978 19.$518 19.518 1878 571 2o449 1979 17.640 17i640 1.878 515 2.393 1980 150762 15o762 1,878 459 2.357 1981 13.884 13k884 l878 '402 260 1982 12,006 12o006 1.878 346 2.224 1983 1 0128 102128 1.678 290 2.168 1984 8.250 8k250 1,878 233 2.111 1985 60372 6i372 1-878 177 2.0%5 1986 4.494 40494 SA1.7 121 1J999 1987 2.61w 21616 Ik127 64 1.191 1988 10489 1i489 376 42 417 1989 1l13 10113 376 31 406 1990 738 738 376 19 395 1991 362 362 188 5 193 Provisional Page 33 Table 4z.2: PERU - ESTIMATI: FUTURE3SERVICE PANTS ON EXTERNAL PUBLIC DEBT OUTSTANDING INCLUDING UNDISBURSED AS OF DECEMBER 31, 1970 Debt Repayable in Foreign Currency (In thousands of U.S. dollars) DEBT OUTSTANDING TRAN5ACTIONS DURING PIRIOD BEGINNING or PERIOD DISBURSED INCLUDING SERVIC6 PAYMlNT% YEAR ONLY UNDISSUNSED PRINCIPAL 1NtIRCIT TOTIL LOANS FRAM GOVERNUtNTS NL. HERLANDS 1971 994 994 42 66 108 1972 968 965 84 62 146 1973 884 884 84 S6 ag0 1974 800 800 64 51 1975 716 716 84 45 229 1976 632 632 84 40 124 1977 547 54? 84 34 118 1978 463 463 84 29 113 1979 379 379 84 23 10o 1980 295 295 84 18 102 1981 211 211 84 12 97 1982 126 126 84 7 91 1983 42 42 42 0 42 Provisional Page 34 Table 4.2i PERU - ESTBUAT.E:D FUJTURE S3RVICE PAYKENTS ON EXTERNAL PUBLIC DEBT OUTSTANDING INCLUDING UNDISBURSTI AS OF DCZIBER 31, 1970 Debt Repayable in Foreign Currency (In thousands of U.S. dollars) DtBT OUTSTANDING TRANSACTIONS DURING PLRIOD BEGINNING or PERIID DISBURSED INCLUDING SERVICE PAYMENTS YEAR ONLY UNDISBURSED PRZN$IPAL INTEREST TOTAL CI) L IOANS FROM GOVERNMENTS i6) (t7 NEW 2EALAND 1971 2#91C 97677 167 1&7 1972 9#67? 9J67? 556 556 1973 9#677 9b677 556 556 1974 9, 67 9hi6 7 7 556 556 1975 90677 9i677 968 556 10524 1976 8,?09 W709 1.935 473 2P408 1977 64774 6W774 1h935 362 2#297 1978 4#839 #0639 1R935 250 2'186 1979 2#903 27903 I0935 139 2'075 1980 968 968 968 25 996 Provisional Page 35 Table 4e.2: PERU - ESTIMATED FUTURE S3ERVICE PAY=,TS ON EXTERNAL PUBLIC DEBT OUTSTANDING INCLUDING UNDISBURSIM AS OF DECEEDER 31, 1970 Debt Repayable in Foreign Currency (In thousands of U.S. dollars) DEBT OUTSTANDING TRANSACTIONS DURING *BRIOD BEGINNING OF PERIOD DISBURSED INCLUDING *IRVfCL PAYMNgTS YEAR ONLY UNDISBUft5D PRINuIPAL INtCRt6O TOTIL LOANS FROM GOVERNMENTS C?) UNITED KINGDOM 1971 1,6T0 2.059 * 131 8{1 1972 1D986 21059 143 151 296 1973 1,913 11914 145 145 290 1974 14768 1b769 145 134 279 1975 1.623 1b624 145 123 255 1976 1.478 1479 145 112 257 1977 1.333 1i334 145 t0o 245 1978 1I188 1h189 145 at 254 1979 1.043 1)044 145 ra 223 1980 898 899 145 6? 292 1981 753 754 145 55 200 1982 608 609 145 44 189 1983 463 464 145 33 ITS 1984 319 320 145 22 167 1985 174 175 145 11 155 1986 29 30 30 1 aa Provisional Page 36 Table 4.2t PERU - EST:131ATEI) FUTURE SERVICE PAYI{;TS ON EXTERNAL PUBLIC DIBT OUTSTANDING INCLUDING UNDISBURSED AS OF DECE1I2ER 31, 1970 Debt Repayable in Foreign Currency (In thousands of U.S. dollars) DEBT OUTSTANDING TRANSACTIONS DURING PSRIOD BEGINNING oF PERIOD DISBURSED INCLUDING SERVICE PAYMENTS YEAR ONLY UNDZSiURSED PRINCIPAL INTEREST TOTAL CI ) LQeS FPRDM GOVERNMENTS 06A 1971 90.610 125i552 6#447 2&339 8.706 1972 87.334 119i105 69279 2.020 6.299 1973 89.164 112i826 5.838 1#853 7.691 1974 91.802 1060987 5,445 1,742 7.187 1975 96.013 101)542 5.831 1.822 7.652 1976 95.706 95#711 4.699 1pb32 6.551 1977 91poo0 91DO13 46186 1D794 5.910 1978 86,822 860827 9A886 14796 5P582 1979 83.036 33A041 S,451 2.063 7.514 1980 77.585 77i590 5,924 1.866 7.791 1981 71.661 ?1.666 5.930 1.660 7.590 1982 650730 65035 1.o931 1,453 7,385 1983 594799 590804 4.289 1.258 5.547 1984 55P510 55k515 8.792 1.123 4P916 1985 S1.718 51i723 8.035 997 4.012 1986 480683 481888 2#278 933 30212 i987 46.404 46A409 2.282 891 3.172 1988 44,123 44i125 2#285 848 3pi33 1989 41.838 41i843 2D288 805 3#093 1990 39.550 390555 2Y292 762 3#053 1991 37P258 37*263 2P295 718 3.014 Provisional Page 37 Table 4.2: PERU - ESTIMATED FUTURE- SERVICE PAYMENTS ON EXTERNAL PUBLIC DEBT OUTSTANDING INCLUDING UNDIaBURSJD AS OF DECE1MER 31, 1970 Debt Repayable in Foreign Currency (In thousands of U.S. dollars) DEBT OUTSTANDING TRANSACTIONS DURING PERIOD BEGINNING OF PERIOD DISBURSED INCLUDING SERVIeC PAYMNVNT YEAR ONLY UNDISDUSLED PRINIVA6L iNtIRST TOTAL UNCLASSIrItD 1971 61,726 167,840 43,663 7,323 50,986 1972 71,228 124,177 39,106 7,087 46,193 1973 85,071 85,071 31,169 5,287 36,456 1974 53,902 53,902 25,214 6,009 31,223 1975 19,190 28,688 19,190 4,048 23,238 1976 9,498 9,498 9,498 2,304 11,802 Table 5.1: CENTRAL GOVERNMENT CURRENT ACCOUNT, 1969-74 (In million of current soles) 1969 1970 1971 1972 1973 1974 Current Revenue /a 32,565 38,721 37,822 45,298 50,158 57,622 Tax from Income, Property, and Exports 10,791 13,949 10.578 11,895 13.630 15,400 Income Tax 6,772 9,557 6,661 77,161 - ® 9,2200 Copper Companies (3,541) (5,141) (2,760) (2,703) (3,043) (3,283) Other Income Tax (3,231) (4,416) (3,901) (4,458) (5,157) (5,917) Property Tax 812 501 380 600 750 800 Export Tax 58 615 578 663 680 700 Other 3,149 3,276 2,959 3,471 4,000 4,700 Import Tax 7,691 7,882 9,005 10,792 12,927 15,495 Production and Consumption Tax 10, 878 12,29 13,119 15,649 17 773 20,193 Timbre (6,571) (7,678) (8,154) (10,122) (Tit7) (13,0T9) Gasoline (1,091) (1,468) (1,608) (1,866) (2,145) (2,467) Other (3,216) (2,953) (3,357) (3,661) (4,151) (4,708) Other Taxes - 461 1,836 - Non-Tax Revenue 2,731 424,937 4 578 T 6,304 Transfers 474 172 1 2 300 Current Expenditures 27,868 31,297 33,288 38,920 42,860 47,208 Wages and Salaries 12,465 13,817 16,117 18,279 20,740 22,198 Purchase of Goods and Equipment 1,513 1,868 1,906 2,500 2,825 3,193 Interest Payments 1,696 2,034 2,862 3,441 4,172 4,989 Current Transfers 5,383 6,510 5,197 7,200 7,700 8,292 Military Outlays 6,811 7,068 7,206 7,500 8,023 8,586 Current Savings 46697 73424 4.53 6.378 7,298 10,484 /a Does not include new proposed tax measures. Source: Ministry of Finance, Central Bank, and Mission estimates. Table $,.2:- 1CENTRAL GOVF4IRMENT CURRENT ACCOUNT, 1968-74 (In million of 1970 soles) 1969 1970 1971 1972 1973 1974 Current Reverme /a 34,903 38,721 35.:282 39,493 40,879 43,939 Tax from income, property and exports 1,566 13,949 9868 10 371 1 14 J,l29 In come tax 7,2 5 o,2114 o0006 {,C0 Copper company 3,795 (5,141) (2,575) (2,357) (2,480) (2,500) Other inccme 3,1463 (4,416) (3,639) (3,887) (14,203) (14,507) Property tax 870 - 501 355 523 611 60 . E4xport tax 62 615 539 578 554 533 Other 3,376 3,276 2,760 3,026 3,260 3,580 Import tax 8 243 7,882 8,400 9,1408 10,536 11,801 Production and consumptiontt 11t69 12 099 12,? _36I i7): 15,8D Timbre c6) (7;678) (7,607) ,822 T 9915) Gasoline (1,169) (1,468) (1,500) (1,627) (1,748) (1,879) Other (3,4147) (2,953) (3,131) (3,192) (3,383) (3,586) Other taxes - - 1430 1,601 - - Non-tax revenue 2 927 14=2 4 T: 25;77 4L a 01 Transfers 20 309 12 2 2T Current Expenditures *2%869 31,297 31,Co52 33,932 314,932 35,9514 Wages and salaries 13,360 13,817 15.034 15,936 16,4114 16,906 Purchase of goods and servic( 1,621 1,868 1,778 2,180 2,302 2,431 Interest payments 1,818 2,034 2,670 3,000 3,400 3,800 Current transfers 5,770 6,570 4,848 6,277 6,277 6,277 Military outlays 7,300 7,068 6,722 6,539 6,539 6,539 Current Savings 5,03 744214 230 5,561 5,947 7,985 3 Does not include new proposed ta.x measures. a/ Tabla 5.3: PUBLIC DIVESTMENT 1971-1974 (AGRICUIXURE) (in millions of 1970 soles) D I S B V R S L N1 E N T S COST THROUGH 1974 Disbursed Foreign before Actual b/ - - - - - - - - - - Programed - - - - - - - - - - - Responsible Goods & External Dec 31, 1971 1972 1973 1974 Technical Programs Institution Total Services Financing -/ 1970 Total External Total Exte Tatal External Total External I. Agriculture A. Central Government 10,901 2,552 2,100 2,341 1,293 249 1,782 507 2,654 432 2,831 387 1. Agrarian Reform & Rural Settlement Min. Agric. 1,042 333 332 185 135 77 260 109 259 67 203 79 2. Promotion D.G. Agric. Prom. 900 198 170 - 101 - 150 46 318 46 331 78 3. Marketing D.G. Marketing 371 33 5 29 5 - 13 1 166 1 158 3 4. Research D.G. Agric. Research 244 65 - 32 52 - 25 - 95 - 40 - 5, Forestry & Hunting DOG. For. & Hunt. 352 77 - 44 29 - 10 - 130 - 139 - 6, Water & Irrigation D0G0 Water & Irrig. 7,156 1,846 1,462 2,033 820 101 1,200 343 1,556 314 1,547 178 7. Food Support CNAA 27 - - - 5 - 5 - 12 - 5 - 8, General Adninistration D. G. Gen. Ada, 130 - - 7 33 - 40 - 25 - 25 - CRYRZA 266 - 79 11 113 71 79 8 63 - - - Various Projects 413 - 53 -- - - - 30 4 383 49 B. Rest of Public Sector 812 - - 241 105 - 147 - 177 - 142 - 1l Agrarian Reform & Rural Settlement CENCIRA 13 - - - 2 - 3 - 4 - 4 - 2, Promotion EPSA 99 - - - - - 43 - 27 - 29 - 3. Marketing EPSA 160 - - 23 19 - 8 - 70 - 40 - 8. General Administration CENCIRA 1 - - - 1 - - - - - - - FNDE 539 - - 218 83 - 93 - 76 - 69 - Total A and B 11,713 2,552 2,100 2.582 1,398 249 1,929 507 2,831 432 2,973 387 a/ For lack of indicators of physical investment, disbursements for fixed investment expenditures hr been used as equivalent to real investment. b/ Investment expenditures for 1971 have been estimated on the basis of actuals through Septctmer 30, 197), and the approved calendar of expenditures for the fourth quarter of 1971. Actual and budgeted expenditures have been expressed in 1970 soles. c/ Includes S/ 525 million of estiTnted external financing, mainly for program VI, disbursed before December 31, 1970 Table 5 : PUBLIC INVESTMENT 1971-1974 (INDUSTRY) (in millions of 1970 soles) ' ~~~~~~~~~~~~~~~~~~a/ COST HP,OUH 197 Disbn sedD I S B U R S E M E N T S COST THROUGH 197,4 D-ibursed Foreign before Actual c/ - - - - - - - - - - Programmed - - - - - - - - - - - Responsible Goods & E-ternal Dec. 31, 1971 1972 1973 1974 Techlical Programs Institution Tntal Services "Lnanci" 1970 Total EIBter nal Total E-eLnail Total External Total External b/ II. Industry d/ A. Central Government MIC 525 - - 173 122 - 230 - - - - - B. Rest of Public Sector DIDUPERU 7,537 4,312 4,051 36 1114 - 1,239 561 2,382 1,353 3,766 2,137 1. Basic Metal Industries a. Steel (SOGESA) 2,310 1,490 1,472 - 26 - 232 81 759 536 1,293 855 b. Hon-ferrouLs Metals 643 376 334 - 2 - 157 67 194 105 290 162 2. Metal-working Industries 789 ,443 375 - 12 - 2J5 89 297 153 265 133 3, Chemicals and Petrochemicals 2,023 1,074 1,115 - 10 - 2 9 172 633 325 1,111 618 4. Pulp and Paper Industries 714 468 359 - 1 - 155 94 230 121 328 114 5. Other Basic Industries 821 461 396 - 1L - 139 58 219 113 449 225 FNDE 237 - - 36 49 - 72 - 50 - 30 - Total A and B 8.062 4,312 4.051 209 236 - 1,469 561 2.382 1.353 3,766 2,137 a/ Includes autonomous public investment, plus the public investment component in mixed public and private industrial enterprises. External disbursements have been derived from a list of individual projects in each program. b/ Excludes the tourism sector, where the public investment program is not yet clearly defined and is tentatively set at some S 600 million for the period 1971-1975. c/ Investment expenditures for 1971 have been estirated on the basis of actuals through September 30, 1971, and the approved calendar of expenditures for the fourth quarter of 1971. Actual and budgeted expernditures have been expressed in 1970 soles. d/ It refers mainly to preparation of sectorial studies, construction of MIC building, and export promotion. It also includes CRYRZA. After 1972, INDUPERU, a public enterprise yet to be created, will centralize and bc responsible for all public industrial investment. e/ An actual disbursement pattern similar to metal working industries has been assumed for other basic i i- stries. Table 5.5: PUBLIC INVESTMENT 1971-1974 (FISHERIES) (in millions of 1970 soles) D I S B U R S E M E N T S COST TEROUGH 1974 Disbursed Foreign before Actual a/ - - - - Progranmed --- - - - - - - - - - Responsible Goods & External Dec. 31, 1971 1972 1973 1974 Technical Programss Institution Total Services Financing 1970 Total External Total External Total External Total Extemral TTI. Fisheries A. Central Government 2,505 950 1,256 59 88 - 157 - 933 550 1,268 706 1. Scientific & Technological Research Min. Fisheries 72 - - - 6 - 16 - 39 - 11 - 2 Fisheries ' Production (extract & transform) Yin. Fisheries 1,599 950 1,1146 45 59 - 100 - 618 510 777 636 3. Marketing Min. Fisheries 148 - - - 6 - 12 - 65 - 65 - 4. Fisheries' Training MtLn. Fisheries 579 - 110 - 11 - 19 - 173 40 376 70 5. Works and Equipment Mtin. Fisheries 92 - - 214 1 - - - 38 - 39 - CRYRZA 15 - - - 5 - 10 - - - - - B. Rest of Public Sector 2,527 939 873 6 61 - 342 - 932 409 1,186 464 lo Scientific & Technological Research IMARPE-CERPER 356 253 142 3 5 - 49 - 161 73 138 69 2. Fisheries' Production (extract & Transform) EPSEP 1,057 686 731 - 56 - 86 - 421 336 494 395 3. Marketing EPCHAP-EPSEP 1,114 - - 3 - - 207 - 350 - 554 - Total A and B 5,032 1,889 2,129 65 149 - 499 _ 1,865 959 2,454 1,170 a/ Investment expenditures for 1971 have been estimated on the basis of actuals through September 30, 1971, and the approved calendar of expenditures for the fourth quarter of 1971. Actual and budgeted expenditures have been expressed in 1970 soles. Table 5.6: PUBLIC INVESTMENT 1971-1974 (MINING) (in millions of 1970 soles) D I S B U R S E M E N T S COST THROUGH 1974 Disbursed Foreign before Actual a-/ - - - - - - Programmed - - - - - - - - - - - Responsible Goods & Extemnal Dec. 31. 1971 1972 1973 197h Technical Programs Institution Total Services Financing 1970 Total External Total External Total External Total External IV. Mining A. Central Government 54 - - 9 6 - 8 - 15 - 16 - 3. Geology and Mining Geolog. Service 54 - - 9 6 - 8 - 15 - 16 - B. Rest of Public Sector 3,662 1,764 1,876 - 280 - 490 237 1,308 622 1,584 817 1l Mining Development IU=EROPERU 1,364 477 L33 - 129 - 219 77 462 162 554 194 2. Metallurgy MINEROPERU 1,667 1,000 987 _ 17 - 120 66 573 315 957 606 3, Geology MINEROPERU 74 45 33 - 20 - - - 27 16 27 17 4. Markcting MIiEROPERL 368 242 2.3 _ 23 - i'45 94 200 I29 - - 5. Support MNEROPERU 188 - 90 - 6 - 46 4 46 _ 6. Atomic Energy JCEA 1 - - - 1 - - - - - - - Total A and B 3,716 1,764 1,676 9 286 - 498 237 1,323 622 1,600 817 a/ Investment expenditures for 1971 have been estimated on the basis of actuals through SeptEmber 30, 1971, and the approved calendar of expenditures for the fourth quarter of 1971. Actial and budgeted expenditures have been expressed in 1970 soles. b/ Excludes hydrocarbons, Table 5.7: PUBLIC DNVESTMENT 1971-1974 (HYDROCARBONS) (in millions of 1970 soles) COST THROUGH 1974 Disbursed b/ Foreign before Actual a/ - - - - - - - - - - Programmed - - - - - - - - - - - Responsible Goods & External Dec. 31, 1971 1972 1973 1974 Technical Programs Institution Total Services Financing 1970 Tobal External Total External Total External Total External V. Hydrocarbons A. Central Government 90 - - - 19 - 71 - - - - - 3. Basic Petrochemical Industry and Fertilizers D.G.H. 8 - - - 1 - 7 - - - - - 4. Exploitation of Natural Gas D.G.H. 11 5 - 6 6. Transportation of Fluids D.G.H. 9 - - - 1 - 8 7. Petroleum Exploration D.G.H. 62 - - - 12 - 50 - - - - - B. Rest of Public Sector 10,653 n.a. 14,903 126 1,149 - 2,285 946 3,383 1,825 3,710 2,132 1. Marketing PETROPERU 395 _ - 59 33 - 95 - 104 - 104 - 2. Refining PETROPERU 2,575 n.a, 1,667 62 139 - 450 320 895 627 1,029 720 3. Basic Petrochemical Industry and Fertilizers PETROPERU 2,649 n.a. 1,970 - 25 - 704 626 907 635 1,013 709 4. Exploration of Natural Gas PETROPERU 147 _ - 2 30 - 57 - 29 - 29 - 5. Petroleum Production PETROPERU 1,396 n.a. 508 - 325 - 345 - 363 254 363 254 6. Transportation of Fluids PETROPERU 1,423 n,a. 758 3 140 - 197 - 4)41 309 642 449 7. Petroleum Exploration PETROPERU 1,866 - - - 303 - 389 - 644 - 530 - 8. Administration PETROPERU 202 - - 154 - 48 - _ _ - _ Total A and B 10,743 4,903 126 1.168 2,356 946 3,383 1.825 ±.712 2232. a/ Investmrnt expenditures for 1971 have been estimated on the basis of actuals through September 30, 1971, and the approved calendar of expenditures for the fourth quarter of 1971. Actual and budgeted expenditures have been expressed in 1970 soles. b/ External disbursements have been estimfated as 70 percent of total disbursements in Refining, Basic Petrochemical Industry, Petroleum Production, and Transportation of Fluids in the years 1972 and 1974. Table 5.8: PUBLIC INVESTMENT 1971-1974 (POWER) (in millions of 1970 soles) COST THROUGH 1914 Disbursed Foreign before Actual a/ - - - - - - - - - - Programmed - - - - - - - - - - - Responsible Goods & External Dec. 31, 1971 1972 1973 1974 Technical Programs Institution Tcnal Services Financing 1970 Total Exterial Total External Total hxternal Total External VI9 Power A. Central Goverrnent 452 133 116 48 65 9 214 91 82 9 43 7 1. Piura-Lambayeque Electrical System D.G.E. 62 6 5 1 9 1 18 2 20 1 14 1 3. Central Region Electrical System D. G. E. 77 12 15 - 5 - 23 5 20 4 29 6 4. Southern Region Electrical System D.G.E. 29 6 8 - - - 11 4 18 4 - CRYRZA CRYRZA 284 109 88 47 51 8 162 80 24 - - - B. Rest of Public Sector 14,157 7,136 4,843 5,778 1,707 971 1,789 1,184 23126 13,157 2,757 1,531 1. Piura-Laimbayeque Electrical System ELECTROPERU 624 340 325 - - - - - 236 137 388 188 2. Santa Corporation Electrical System CORSAN 1,415 826 606 21 377 215 136 47 301 161 580 983 3. Central Region Electrical System b/ CORYVAN-SEN 10,695 5,336 3,334 5,592 1,103 756 1,445 1,106 1,234 715 1,321 757 4. Southern Region Electrical System ELECTROPERU 355 211 180 - 6 - 7 - 68 32 274 148 5. Isolated Electrical Systems SEN 531 198 198 30 101 - 64 31 213 122 123 55 FNDE SEN 537 225 - 135 120 - 137 - 74 - 71 - Total A and B 2.609 7.269 4 5,826 1,772 980 2.003 1,275 2 202,L6 2= 800 l a/ Investment expenditures for 1971 have been estimated on the basis of actuals through September 30, 1971, and the approved calendar of expenditures for the fourth quarter of 1971. Actual and budgeted expenditures have been expressed in 1970 soles, b/ Includes a budgetary expansion of S/1,500 million in 1972 for Mantaro Corporation. Table 5.9: PUBLIC INVESTMENT 1971-1974 (TRANSPORT AND COMMUNICATIaNS) (in millions of 1970 soles) COST THROUGH 1974 Disbursed Foreign before Actual a/ - - - - - - - - - Programmed - - - - - - - - - - - Responsible Goods & External Dec. 31, 1971 1972 - 1973 1974 Technical Programs Institution Total Services Financing c/ 1970 Total External Total External Total External Total External VII. Transport and Communications A, Central Goverrunnt 17,174 8,094 6,890 4,091 1,960 686 2,739 739 3,661 1,607 4,723 2,176 1, General Administration Dir. Superior 58 - - - 3 - 25 - 18 - 12 2. Mechanical Equipsent Service of Mech, Equip 445 381 3 46 6 - 380 - 13 3 - - 3. Air Transport Infra- Dir, of Civil Aeron. structure 642 21 2)4 143 85 9 121 - 142 - 151 5. Water Transport Infra- Dir. of Water Transp. structure 192 18 18 - 23 9 39 9 90 - 40 7. Highway Safety Dir, of Highway Safety 370 - - 4 16 - 51 - 82 - 217 - 9. Railway Transport Dir. of Railways 331 198 172 50 3 - 34 - 99 72 1)45 86 10, Highway Infrastructure Dir. of Hwy. Infras. 10,921 5,317 4,545 3,789 1,193 370 1,238 373 2,O64 857 2,637 1_,29? 11. Highway Maintenance Dir. of Hwy. Irfras. 2,116 838 836 - 396 131 414 124 565 293 741 288 12. Mail Reorganization Dir. of Mail & Telegraph 193 7 2 - 17 - 96 - 30 1 50 1 13, Telecommunications Dir. of Telecommuni- Network cations 221 69 59 8 9 1 30 1)4 37 22 37 22 I14, Radioelectric Research Dir, of Communications 36 19 19 - 4 - 8 4 13 7 11 8 CRYRZA 1,7)49 1,226 1,212 51 205 166 303 215 50` 352 682 479 B, Rest of Public Sector 3,735 1,648 1,5b4 1438 336 64 84j6 208 1,040 601 1,075 630 4, Airport Equipment CORPAC 165 19 22 - 22 4 29 18 73 - 41 - 5, Water Transport Equipmert ENAPU 1,057 621 5122 104 93 42 340 56 350 284 170 91 6, National Merchant Fleet CPV 596 417 417 - - - 154 107 200 140 242 170 8, Regulation of Land Transport DRETT 32 - - _ 9 - 2 - 12 - 9 - 13. Telecorm=dnications Network ENTEL 713 591 591 - 21 18 99 27 191 177 402 369 FNDE 1,172 - - 334 191 - 222 - 214 - 211 - Total A and B 20^ 90 9,742 81433 > ; 9 22296 750 3,585 947 4_701 2,208 5,796 2,806 a/ Investment expenditures for 1971 have been estimated on the basis of actuals through September 30, 1971, and the approved calendar of expenditures for the fourth quarter of 1971. Actual and budgeted expenditures have been expressed in 1970 soles. b/ Includes budgetary expansions of S/377 million in Program II, of S/77 million in Program IX and SA450 million in Program X. External disbursementsin Program X have been increased proportionately to the total disbursement increase. c/ Includes S11,722 millions of external financing, mainly for Program X, disbursed before December 31, 1970. Table 5.10: PUBLIC INVESTMENT 1971-1974 (EDUCATION) (in millions of 1970 soles) D I S B U R S E M E N T S COST THROUGH 1974 Disbursed Foreign before Actual a/ - - - - - - - - - - Programmed - - - - - Responsible Guods & External Dec. 31, 1971 1972 1973 1974 Technical Programs institution Total Services Financing 1970 Total External Total External Total External Total External VIII. Education A. Central Government 3,818 1,283 1,362 225 261 38 7418 211 1,138 462 1,446 651 1. School Construction Educ. Ministry 2,033 447 643 168 65 - 324 - 597 247 879 396 2. School Equipment Educ. Ministry 1,426 787 6U3 54 69 - 256 211 480 215 567 255 CRYRZA 359 49 38 3 127 38 168 - 61 - - - B, Rest of Public Sector 1,040 172 117 202 15 124 108 4 252 46 293 53 3. Sports and Recreation Institute INDyR 156 - - 36 21 - 9 - 40 - 50 - 4, Perovian University System CONUP 767 153 103 117 153 114 72 4 200 40 225 45 5. National Culture Institute INC 37 19 14 - - - 9 10 6 18 8 FNDE 80 - - 49 11 - 18 - 2 - - - Total A and B 14,158 1455 1479 446 52 856 215 1,390 508 1,739 704 a/ Investment expenditure for 1971 lave been estimated on the basis of actualsthrough September 30, 1971, and the approved calendar of expenditures for the fourth qouarter of 1971. Actual and budgeted exponditures have been expressed in 1970 soles. Table 51_: PUBLIC INVESTMENT 1971-1974 (HEALTH) (in millions of 1970 soles) D I S B U R S E M E N T S COST THROUGH 1974 Disbursed Foreign before - Actual a - - - - - - - - - - Programmed - - - - - - - - - - - Responsible Goods & External Dec. 31, 1971 1972 1973 1974 Technical Programs Institution Total Services Financing 1970 Total External Total External Total External Total External IX. Health A. Central Government 1,359 5D3 192 333 150 52 232 39 306 48 338 53 lo Water, Rural Sewerage & Dir, of San. Eng. Water Resources Con- servation 523 225 142 178 58 41 40 - 119 48 128 53 2. Construction & Equipment of Health Clinics 711 355 38 146 55 - 122 38 178 - 210 - CRYRZA 125 13 12 9 37 11 70 1 9 - - - B. Rest of Public Sector 225 112 120 47 16 - 52 40 55 40 55 40 2. Construction & Equipmenta- Nat. Inst. of Health ticn of Health Clinics b/ 225 112 120 47 16 - 52 40 55 40 55 40 Total A and B 1.581 705 312 380 166 52 284 79 361 88 393 53 a/ Investmrent expenditures for 1971 have been estimated on the basis of actuals through September 30, 1971, and the approved calendar of expenditures for the fourth quarter of 1971. Actual and budgeted expenditures have been expressed in 1970 soles. b/ Part of investmnt is executed by the Public Beneficense of Lir and the National Fund for Health and Social Welfare. It does not include Social Security Institutes. Table 5.12: PUBLIC INVESTI'ET 1971-1974 (HOUJSING) (in millions of 1970 soles) D I S B U R S E M E N T S COST THROUGH 1974 Disbursed Foreign before Actual c/ - - - - - - - - - - Programmed - - - - - - - - - - - Responsible Goods & External Den, 33 1971 1972 1973 1974 Technical Programs Institution Total Services Financing 1970 Total External Total External Total External Total External Xs HoFusing b/ A. Central Government 14,231 1,633 1,550 890 657 310 981 457 963 269 740 221 L Urban Develorment Plan c/ Dir. Gen. Urb. Dev, 91 25 25 9 10 - 38 25 19 - 15 - 2. Water and Sewerage d/ d/ Infrastructure Dir. Gen. San. Works 2,051 1,082 1,039 774 220 91 358 227 342 207 357 214 3, Land Improvement Dir. Gen. Construct. 168 - - 8 9 - 41 - 50 - 60 - Ki. Housing Construction Dir, Gen. Construct. 165 - - - 13 - 38 - 52 - 62 - 6. Communal Services Dir. Gen. Construct. 3143 - - 29 28 - 43 - 11I - 129 - 7, Communal Promotion Dir. Gen. Con. Prom. 402 - - 5 82 - 105 - 105 - 105 - 8. Restoration of Public Buildings and Monuments 14in, Housing 22 - - - - - - - 10 - 12 - CRYRZA 989 526 486 65 295 219 358 205 271 62 - - BE Rcst of Public Sector 2,946 346 326 469 373 - 579 - 617 96 908 232 2. Water and Sewerage Infrastructure ESAL-ESAR 890 346 328 23 31 - 155 - 200 96 481 232 3, Land Lmprovement EMADI 420 - - - - 126 - 120 - 130 4, Housing Construction EMADI 354 - - 71 29 - 84 - 80 - 90 - 6. Comunal Services SERPAP 70 - - 8 24 - 4 - 16 - 18 - FNDE 1,212 - - 367 245 - 210 - 201 - 189 - Total A and B 7,177 1,979 1,875 1,359 1,030 310 1,560 457 1,580 365 1.648 446 a/ Investment expenditures for 1971 have been estimated on the basis of actuals through September 30. 1?71, and the approved calendar of expenditures for the fourth quarter of 1971. Actual and budgeted expenditures have been expressed in 1970 soles. b/ Program V (Credit and assistance for housing construction) has been excluded from public ilrves;tment. c/ Includes malti-program studies. d/ Includes S/ 300 million of estimated external financing disbursed before Dec. 31, 1970. Table 5.13: PUBLIC INVESTNT 1971-1974 (OTHER) (in millions of 1970 soles) D I S B U R S E M E N T S COST THRCUGH 1974 Disbursed Foreign before Actual - - - - - - - - - - Programmed - - - - - - - - - - - Responsible Goods & External Dec. 31, 1971 1972 1973 1974 Technical Programs Institution Total Services Financing a/ 1970 Total External Total External Total External Total External II. Other A. Central Government b/ 2,632 n.a. 72 577 323 63 305 9 569 _ 858 _ B. Rest of Public Sector c/ 6,760 n,a. 56 734 1,353 39 1,545 17 1,522 _ 1,606 - Total A and B 9,392 n.a. 128 1. 11 1.676 12a IiB50 26 2.091 _ -,d _ a/ Disbursements for 1971 and 1972 have been estimated on the basis of the 1971-1972 Biennial Budget. Disbursements for 1972-1974 have been taken from the 1971-1975 National Development Plan. Budgeted expenditures have been expressed in 1970 soles. b/ Includes programs administered by the Presidency (ONDCJ, ONDECOOP, ONIT, et6.); Ministries of th nterior, Foreign Relations and EconomW and Finance; National Planning Institute; and CRYRZA's own program. c/ Includes public institutions under the Presidency of the Republic (ONERN, CENIP, SENAH*iI and EL PERUANO); Social Security Institutes and local governments. d/ Includes only external financing contemplated for the period 1971-19740 Table 6.1w MONETARY SITUATION, 1965-70 (In millions of Soles) 1965 1966 1967 1968 1969 1970 Foreign Reserves (net) 5,578 4,94 3,851 4,255 5,868 15,869 Domestic Credit 21,327 26,835 31,370 33,152 37,170 43,200 Public Sector (net) 4,,423 7,776 10,193 10,283 11,595 11,114 Private Sector (gross) 20,785 23,917 27,352 31,207 34,282 39,887 Other (net) -3,881 -4,858 -6,175 -8,138 -8,707 -7,765 Long-tenm Foreign Liabilities 428 632 1,107 O 1105 1,132 1,084 Liabilities to Private Sector 26,477 31,18 34,114363602 41026 57,985 Money 13,093 15,688 17,670 19,156 23,566 35,467 Quasi-money 13,384 15,1460 16,4144 17,346 18,340 22,518 Source: Central Reserve Bank. Table 692: ANNUAL PERCENT VARIATION IN MONETARY SITUATION, 1966-70 1966 1967 1968 1969 1970 Foreign Reserves (net) -11.4 -22.1 10.5 37.9 170.4 Domestic Credit 25.8 16.9 6.3 11.4 16,? Public Sector (net) 75.8 31.1 0.9 12.8 -4.2 Private Sector (gross) 15.1 14.4 14.1 9.9 16.2 Other (net) -25.2 -27.1 -31.8 -7.0 10.8 Long-tenm Foreign Liabilities 47.7 75.2 -0.2 2.4 -4.3 Liabilities to Private Sector 17.6 9.5 7.0 14.8 38.2 Money 19.8 12.6 8.4 23.0 50.5 Quasi-money 15.5 6.4 5.5 5.7 22.8 Source: Central Reserve Bank. Table 6.3: SUMMARY ACCOUNTS OF THE BANKING SYSTEM (In millions of Soles) 1965 1966 1967 1968 1969 1970 A. Foreign Reserves (net) 5,578 4,945 3,851 4,255 5,868 15,869 1. Foreign Assets 6,725 7,083 8,964 8,723 10,334 19,183 2. Foreign Liabilities -1,147 -2,138 -5,113 -4,468 -4,466 -3,314 B. Domestic Credit 21,327 26,835 31,370 33,352 37,170 43,200 1. To Central Government (net) 5,0810! 8,755 11,107 12,632 12,483 12,157 2. To Local Governments (net) -63 -23 -6 -74 -77 -274 3. To Other Official Entities (net) -595 -956 -908 -2,275 -811 -769 4. To Private Sector 20,785 23,917 27,352 31,207 34,282 39,851 5. Net Capital & Surplus -4,305 -6,575 -7,773 -9,317 -10,900 -12,828 6. Other 424 1,717 1,598 1,179 2,193 5,063 C. Long-term Liabilities to International Institutions 428 632 1,107 1.105 1,132 11084 D. Liabilities to Private Sector 26,477 3148 3 36,502 41,906 57,985 1. Currei:cy 6,965 7,940 8,977 10,002 11,791 16,252 2. Demand Deposits 6,128 7,748 8,693 9,154 11,775 19,215 3. Term Deposits 3,999 3,364 2,985 3,078 3,760 6,558 4. Savings Deposits 5,420 6,546 6,585 7,171 7,560 7,944 5. Deposits in Foreign Currency 2,946 3,826 4,662 4,241 3,427 278 6. Mortgage Bonds 1,019 1,724 2,145 2,812 3,556 7,590 7. Foreign Exchange Certificates (-) (-) 67 44 37 148 1/ Excludes S/.894 million on lending to the Central Government by the Banco de la Nacion financed by short-term foreign borrowing. Source: Central Reserve Bank of Peru. Table 6.4: CENTRAL REERVs BANX SUMMARY ACOOUNTS (In millions of Soles) 1965 1966 1967 1968 1969 1970 A. Foreign Reserves (net) 4701 4,048 4,641 4L245 5,482 12.543 1. Foreign Assets 4,701 4,103 5,607 5,168 7,406 14,178 2. Foreign Liabilities - -55 -966 -1,123 -1,924 -1,635 B. Domestic Oredit 9 58 151 10452 1U037 ( 972 1. To Centmi Governmerit (net) 4,612 6,667 7,527 94z22 9,432 9,433 2. To Other Official Entities (net) -16 -5 -21 -303 -22 (-) 3. To Banks 2,118 1,525 1,779 1,627 1,884 3,394 a. To Banco de la Nacion (-) (-) (-) (-) (-) (-) b. To Commercial and Savings Banks (108) (242) (116) (224) (461) (1,221) c. To Specialized Banks (2,010) (1,284) (1,663) (1,403) (1,423) (2,173) 4. Official Capital and Surplus -214 -216 -221 -278 -588 -864 5, Net Unclassified Assets 179 287 87 -16 231 -231 C. Liabilities to Banks 4 4,339 4693 , 1. To Banco de la Naci6n 26 42 15 67 384 466 2. To Commercial and Savings Banks 4,051 4,090 14,383 3,984 3,553 6,733 3. To Specialized Banks 311 207 295 365 565 605 D. Liabilities to Private Sector 6,992 7,967 9,099 10,081 11,917 162471 1. Currency 6,965 7,940 8,977 10,002 11,791 16,252 2. Demand Deposits 26 26 39 34 84 71 3. Deposits in Foreign Currency 1 1 16 1 5 (-) 4. Foreign Exchange Certificates - - 67 44 37 148 Source: Central Reserve Bank of Peru. Table 6.5: BANCO DE LA NACION SUMMARY ACCOUNTS (In millions of Soles) 1965 1966 1967 1968 1969 1970 A. Foreign Reserves (net) -131 -526 -1 461 -1,051 -331 4 402 1. Foreign Assets IT 363 X 2. Foreign Liabilities -282 -572 -1,579 -1,149 -714 -418 B. Cash Reserve Deposits and Other Claims on Central Reserve Bank 8 82 25 35 h08 537 1. Currency E - 17 17 9-2 abZ 2. Deposits 2 74 11 20 316 169 C. Domestic Credit 1,311 1,307 2,359 1 799 1,898 3 791 1. To Central Government (net) 9142 2,071 3,100 2, 1,726 2. To Local Governments (net) 38 49 4& 38 26 -100 3. To Other Official Entities (net) -31 -808 -733 -1,267 -93 -121 4. To Banks 336 238 79 694 1,578 5,749 a. To Cornercial & Savings Banks 265 219 62 15 250 5,248 b. To Specialized Banks 71 19 17 679 1,328 501 5. To Private Sector 186 141 211 169 209 504 6. Official Capital and Surplus -189 -413 -276 -593 -794 -987 7. Net Unclassified Assets 57 29 -70 -188 -754 2,162 D. Liabilities to Central Reserve Bank - - 141 - - - E. Liabilities to Other Banks 731 136 167 32 542 5 294 1. To Commercial and Savings Banks 21 -- -- 502 4199 2. To Specialized Banks 710 7- 85 32 40 1,095 F. Liabilities to Private Sector 457 727 615 751 1,433 3,436 1. Demands Deposits 1 337 I77 202 757 2,1)4 2. Term Deposits 309 378 439 526 663 1,119 3. Deposits in Foreign Currency 1 11 18 23 13 176 4. Savings Deposits - - - - - - I/ 1ixcludesS/.894 million on lending to tne Central Government by the Banco de la Nacion financed by short-term foreign borrowing. Source: Central Reserve Bank of Peru. Table 6.6: SUNINARY ACCODUNTS OF THE SPECIALIZED BANKS (In mnillions of Soles) 1965 1966 1967 1968 1969 1970 A.___________________ -702 -l 283 -2,782 -l 436 -1 140 -597 A. Foreign Reserves (net) 50 ____917 1. Foreign Assets 12 190 12 23 17 2. Foreign Liabilities -752 -1,407 -1,972 -1,624 -1,238 -768 B. Cash, Reserve Deposits and Other Claims on Central Reserve Bank 302 216 333 369 612 634 1. Currency 2 18 332 g3 310 2. Deposits 150 30 127 37 229 324 C. Domestic Credit 4 671 56 68 7 425 8 289 9 659 13457 1. To Central Government (net) t I 1T& .1, 2. To Local Governments (net) - 6 7 6 14 7 3. To Other Official En-tities (net) 9 75 11.3 -375 -363 -597 )1. To Banks 1,123 627 761 969 1, S0L 3,953 a. To Banco de la Naci6n 715 67 o5 33 31 1,106 b. To Commercial & Savings Banks 408 56o 676 936 1,473 2,847 5. To Private Sector 6,003 7,919 10,352 12,820 14,196 15,353 6. Net Capital and Surplus -2,313 -2,559 -3,6615 -4,275 -4,951 -5,585 7. Net Unclassified Assets 5 -263 -484 -768 -829 -934 D. l.ong-Term Liabilities to International Institutions 428 632 1,107 1,105 1,132 1,084 E. liabilities to Central Reserve Bank 2,012 1L4 1,7a6 1,4O4 1z23 2Z23 F. Liabilities to Other Banks 548 743 627 1 657 2 67355 1. To Banco de la Naci6n 95 91 509 2. To Commercial and Savings Banks 453 T ' 538 883 1,210 1,446 G. Liabilities to Private Sector 1,_ 208 2,526 3,056 3,903 8,252 2. Demand Deposits 203 339 38 432 a W 715 43. 46 9 5 21 160 569 3. Savings Deposits 17 44 37 59 100 145 4. Deposits in Foreign Currency 2 16 74 40 28 - 5. Mortgage Bonds 1,039 1,676 2,025 2,503 3,147 6,523 Source: Central. Reserve Bank of Peru. Table 6.7: SUMKARY ACCOUNTS OF THE COMMERCIAL AND SAVINGS BANKS (in millions of soles) 1965 1966 1967 1968 1969 1970 A. Foreign Reserves (net) 1 711 2,708 2,45 2.697 1 859 -479 1. Foreign Assets 1 2,810 , 3,29 2. Foreign Liabilities -113 -102 -596 -572 -589 -494 B. Cash Reserve Deposits and Other Claims on Central Reserve Bank 178 4124 4,402 4,004 3644 6,799 1. Currency 1,396 1, 1,743 31,610 2. Deposits 2,682 2,698 2,527 2,004 1,966 4,704 3. Certificates - - 132 52 38 11 C. Domestic Credit 12,741 14,662 15,9_36 17168 21455 3 6 1. To Central Government (net) -291 194 1,236 2. To Local Governments (net) -101 -78 -62 -118 -117 -181 3. To Other Official Entities (net) -556 -218 -273 -331 -334 -51 4. To Banks 476 784 549 799 1,669 5,380 a. To Banco de la Nacion 23 1 1 - 583 3,855. b. To Specialized Banks 453 783 548 799 1,086 1,525 5. To Private Sector 14,596 15,857 16,790 18,218 19,878 23,994 6. Net Capital and Surplus -1,589 -3,087 -3,655 -4,174 -4,568 -5,392 7. Net Unclassified Assets 206 1,555 2,393 2,440 3,691 3,816 D. Liabilities to Central Reserve Bank 108 242 124 225 454 1,669 E. Liabilities to Other Banks 679 880 793 1,031 1,850 7 271 1. To Banco de la Naci6n A 2 93 21 477 4,4 2. To Specialized Banks 401 602 700 1,010 1,373 2,832 F. Liabilities to RrLvate Sector 172743 020372 21874 2261 3 6 1. -i=nci Deposits 5,5 ,4 110 345 10,46 5w8 2. Temn Deposits 3,644 2,978 2,541 2,531 2,937 4,870 3. Savings Deposits 5,402 6,502 6,548 7,112 7,460 7,799 4. Deposits in Foreign Currency 2,942 3,799 4,555 4,177 3,381 103 5. Mortgage Bonds - 48 120 308 410 766 Source: Central Reserve Bank of Perui Table 7.1: ANCHOVY CATCH (Metric tons) Period Catch Fishing Year Catch Calendar Year Catch Sept-Dec 2,162,785 Jan-Aug 5,932,861 1965/66 8,095,646 Sept-Dec 2,596,960 1966 8,529,821 Jan-Aug 5,645,345 1966/67 8,242,305 Sept-Dec 4,179,279 1967 9,824,624 Jan-Aug 5,794,961 1967/68 9,974,24o Sept-Dec 4,467,700 1968 10,262,661 Jan-Aug 5,619,652 1968/69 10,087,352 Sept-Dec 3,340,808 1969 8,960,460 Jan-Aug 7,598,266 1969t70 1,939,074 Sept-Dec 4,784,584 1970 12,382,850 Jan-Aug 5,211,439 1970/71 9,996,023 Sept-Dec (4,500,000) 1971 (9,711,L39) Jan-Aug (5,500,000) 1971/72 10,000,000 Source: EPCHAP. Tabl6, 7.2: INDmE OF MANUFACTURING PRODI)CTION (1967-100) Annual Rate of 1968 1969 1970 1971 Change l 9 1970 1971 Food products without fishmeal 102.1 99.6 113.0 131.7 -2.5 13.5 16.5 Fishmeal 105.8 88.7 123.8 97.8 -16.2 39.6 -21.0 Drinks 102.2 103.6 111.6 130.6 1.4 7.7 17.0 Tobacco 100.7 109.5 118.h 133.8 8.7 8.1 13.0 Textiles 110.0 99.5 117.1 146.4 -9.6 17.7 25.0 Clothing and shoes 94.8 95.7 112.5 121.5 0.9 17.6 8.0 Wood 110.4 116.7 129.8 149.3 5.7 11.2 15.0 Paper 105.7 102.5 120.6 127.8 -3.0 17.7 6.0 Printing 104.9 113.8 117.1 120.6 8.5 2.9 3.0 Leather 99.8 111.8 110.2 126.7 12.0 -1.)4 15.0 Rubber products 92.9 107.5 127.3 140.0 15.7 18.4 10.0 Chemical products 106.7 112.1 125.2 145.2 5.1 11.7 16.0 Petroleum products 122.0 123.7 101.6 113.8 1.4 -17.9 12.0 Minerals (non-metallic) 97.3 94.7 99.9 129.9 -2.7 5.5 30.0 Basic metals 119.0 113.1 116.2 113.9 -5.0 2.7 -2.0 Mectallic products 92,5 89.3 113.5 136.2 -3.5 27.1 20.0 Machinery 98.0 94.7 126.7 119.1 -3.4 33.8 -6.0 Machines and electrical equipment 110.1 129.6 146.4 164.0 17.7 13.0 12.0 Transport equipment 52.6 96.0 86.1 70.6 82.5 -10.3 -18.0 Others 99.3 99.5 120.9 139.0 0.2 21.5 15.0 Manufacturing without fishmeal 102.3 104.4l 114.9 129.8 2.1 10.1 13.0 Manufacturing without fishmeal and basic metals 100.7 103.6 114.8 131.4 2.9 10.8 14.4 Total manufacturing 102.7 102.9 115.8 126.7 0.2 12.5 9.4 Source: Central Reserve Bank, Ministry of Finance and Mission estimates. Table 8.1: CHANGE IN COST OF LIVING INDEX, 1965-70 (Annual average percentage change) 1965 1966 1967 1968 1969 1970 Cost of Living (Lima-Callao) 16.3 8.9 9.8 19.1 6.1 5.0 Food 18.7 4.9 11.1 17.0 5.3 3.1 Clothing 11.2 7.2 8.3 13.0 4.8 6.6 Housing 15.3 16.3 6.6 20.5 8.o 10.7 Other 16.2 9.0 10.h 30.0 7.1 2.6 Source: Department of S>atistics and Census. Table 8.2: OOST OF LIVING INDEX, 1967-71 (1966=100) General Food Clothing Housing Other 1968 January 124.63 124.57 119.56 120.C6 134.43 February 125.25 125.48 120.26 120.54 135.18 March 126.64 126.21 120.57 122.44 138.32 April 127.55 127.91 120.98 122.58 138.70 May 128.55 129.32 121.39 122.75 139.91 June 131.87 131.69 121.94 132.0O 140.47 July 133.55 133.06 123.31 132.60 145.26 August 134.35 133.16 123.74 133.04 149.03 September 133.81 131.67 123.86 133.3)4 150.06 October 134.07 131.93 124.39 133.39 150.43 November 134.12 131.93 124.63 133.14 150.41 December 134.6]. 132.33 124.69 134.77 150.4) Average 130.74 129.96 122.45 128.42 143.54 1969 January 135.14 133.16 124.79 -135.11 150.60 February 135-74 134.08 124.91 135.1)4 151.30 March 137.66 137.48 124.99 135.32 152.03 April 135.87 141.43 125.05 135.55 152.65 May 140.04 140.90 127.38 136.11 153.02 June 134.64 138.19 127.81 140.22 153.56 July 139.42 137.25 129.07 140.41 154.10 August 138.93 135.52 130.56 140.a2 154.99 September 138d.49 1344.[4° 130.88 1110.99 155.42 October 139.16 135.43 131.25 141.23 155.84 November 140.21 137.25 131.62 141.35 155.96 December 1)2.28 137.59 132.87 149.61 156.00 Average 138.83 136.89 125.43 139.33 153.79 1970 January 143.16 139.11 133.33 149.63 156.07 February 142.66 138.04 133.36 149.73 156.35 March 143.52 139.30 133.72 150.32 156.73 April 1)4)4.13 140.33 134.62 1¸50A.9 156.25 May 1J43.82 135.92 136.97 150.65 156.85 June 145.35 139.70 137.05 155.96 156.88 July 1)45.70 :1)0.31 137.37 155.96 156,56 August 146.23 1)40.66 137.90 156.25 158.34 September 147-49 142,61 138.55 156.54 159.05 October 1-48.67 144.77 135.69 156.67 155 .17 November 1i49.21 145.20 139.31 156.92 160.46 December 150.26 1i4477 141.42 161.70 160.57 Average 1585 141.i)4 136.85 15)4.26 157.80 1571 January 150.91 114.57 161.94 1)43.68 163.40C February 151.71 1)45.37 162.51 1)45.0? 164.00 March 152.583 147.06 162.67 146.08 16)4.9i April 153.19 1)47.39 162.91 1)46.50 165.15 May 153.33 1)43.23 -63.05 17.23 155.73 June 15)4.5)4 149.1)4 163.56 148.06 165.95 July 157.00 152.90 16)4.13 150.87 166.25 August 153.08 154.42 16)4.45 151.6c 167.23 Average 15)4.02 148.63 163,15 147.39 165.33 Source: National Directorat,e of Statistics and Census. Table 8.3: PRICE INDEES, 1965-71 (1970=100) 1965 1966 1967 1968 1969 1970 1971 Cost of Living Index 63.0 68.6 75.3 89.6 95.2 100.0 107.2 Government Consumption Index 63.1 75.3 80.7 88.7 93.7 100.0 107.2 Gross Domestic Investment Index 65.2 68.7 79.7 93.3 97.3 100.0 107.5 Exports of Goods and Non-Factor Services Index 48.4 56.4 61.8 79.2 87.6 100.0 95.1 Imports of Goods and Non-Factor Services Index 69.8 71.8 77.9 97.9 98.3 100.0 102.7 Implicit GNP Deflator 58.2 65.3 73.2 86.3 93.1 100.0 107.2 Source: Central Reserve Bank and Mission estimates.