In the first half of 2021, the FDI that arrived from the neighboring country grew 596% compared to the same period of 2020.
Ecuador attracts the attention of investors from several countries who are looking for sectors to locate their capital. One of these is neighboring Peru, whose businessmen have increased their visits to the country in trade missions and forums with clear business intentions.
One of these initiatives was the Ecuador Open for Business, organized by the Government between November 18 and 19, which attracted a delegation of 50 businessmen from that country. The day before, another mission of 20 Peruvian businessmen, led by the Corporation for Investment and Work (CIT Peru), was received in Quito by the board of the Ecuadorian-Peruvian Chamber of Commerce and Integration (Camepe).
More than $ 3,000 million would be the initial investment expectation after the Ecuador Open for Business forum
Alexandra Mosquera, executive director of Camepe, He mentioned that business and investment opportunities in Ecuador were exposed to entrepreneurs, who mostly represented the agricultural, telecommunications, mining, construction sectors, among others.
This interest coincides with the growth in the figures for trade between the two nations.
Mosquera assures that Peru is the tenth destination for Ecuadorian exports, which grew 69% from January to September, and occupies the fifth place of origin of imports that increased 48% compared to the same period in 2020.
Between 2010 and 2021, more than 90% of non-oil exports to that country were concentrated in nine sectors: metalworking (16.40%); forestry and manufactured products (15.90%); copper minerals, their concentrates and others (23.47%); fishing (7.78%); processed foods (11.87%); plastics (7.78%); agribusiness (2.93%); personal and home care (2.18%); cocoa and processed products (2.74%).
“Trade has been strengthened, although the trade balance is favorable to Peru,” said the executive director of Camepe, who added that in the period January-June 2021, foreign direct investment (FDI) from Peru in Ecuador grew by 596% in relation to 2020, going from $ 36,600 to $ 254,480.
The Ministry of Production, Foreign Trade, Investments and Fisheries, through the Commercial Office in Lima, also releases its figures, noting that the accumulated investment between 2010 and 2020 of Peruvian companies in Ecuador amounts to $ 249 million and, at the date, according to information from the Superintendency of Companies, Securities and Insurance, there are 1,719 Peruvian companies settled in Ecuador.
He highlighted, for example, the investment contract with the Gloria Group, from the dairy sector, for $ 12 million to expand the plant that is already in the country. Furthermore, this conglomerate has invested close to $ 600 million in Ecuador with a presence in the food, cement and sugar sectors.
Peruvian group Gloria seeks to expand investments in Ecuador in agribusiness and renewable energy projects
And the situation seems to be improving. With a single proposal, Peru could almost achieve the FDI it has brought to Ecuador in the last ten years. José Manuel Saavedra, director of CIT Peru, talks about an aquaculture project with an investment of more than $ 220 million that is about to be closed.
Saavedra announced that this project also involves an alliance with an Italian fund and a Hungarian institution to undertake a project to raise freshwater fish for export to Asia.
“Today Ecuador is living it, it is an opportunity if you want to grow your company, if you want to expand your business and generate opportunities for your organization, I believe that you should come to Ecuador as soon as possible,” recommended Saavedra, whose organization has a commercial and technological immersion program called MIC (International Commercial Mission), in which to date four commercial missions have been organized to Ecuador, two in 2018 and two in 2021.
“This year’s were held in Guayaquil, in September, and Quito, in November, with successful results due to the size of the investment that has been brought to Ecuador,” said the director of CIT Peru, who recognized that Ecuador is attractive in agro-export, mining, technology and construction.
In addition to the aquaculture project, in which Saavedra assured that they have already made progress with the Vice Ministry of Fisheries of Ecuador, he also includes as an achievement, from these missions, the entry of the Daewoo brand white line and various projects in agriculture, mining and construction for $ 20 million.
Meanwhile, Mosquera highlighted several factors that influence this renewed interest in doing business between the two countries.
On the one hand, the maturity of Peruvian companies to expand their products and services to new markets, such as Ecuador, and on the other, the greater promotion of Ecuador as an investment destination carried out by the current Government.
“Ecuador is attractive because of the stability provided by the dollar and because of the incentives in force at the national and local levels,” says the executive director of Camepe, which currently groups around thirty medium and large Ecuadorian and Peruvian companies from the industries, commerce and services sectors.
Saavedra coincides with the advantages of the dollar and the economic openness that Ecuador now shows to the world and adds the legal stability that the Government offers.
The Ministry made sure that they expect capitalize in the short term the new investments coming from Peru, by ensuring that there is a real interest in generating new business in Ecuador.
“Our neighboring country is closely watching the development of the food industry in Ecuador, in which there is special interest, along with mining, due to the technology and machinery that could be provided by Peruvian companies and the development of a regional value chain, to adjust logistics costs that today affect international trade ”, reported the State portfolio.
Bilateral relationship
Balance of trade
According to the Ministry of Production, Foreign Trade, Investments and Fisheries, the trade balance has historically been positive for Ecuador, amounting to $ 141 million in 2019; However, in 2020, due to the effects of the pandemic, the balance presented a deficit of – $ 228 million and in 2021 of – $ 254 million.
Non-oil exports
There is an increase of 4% in this item, from $ 341 million registered in 2019 to $ 354 million in 2020. As of November 2021 there is an amount of non-oil exports for $ 342 million, with a predominance of products such as wooden boards, copper concentrates, gas cookers, balanced feed for shrimp and tilapia, canned tuna and crackers. These represent almost 50% of exports to this destination.
Paul is a talented author and journalist with a passion for entertainment and general news. He currently works as a writer at the 247 News Agency, where he has established herself as a respected voice in the industry.
