Thomas Stewart Peru
International Marketing Project
Thomas Stewart Crater School of Business 1 5/16/12 Thomas Stewart Peru
Introduction ...... 3 Issue ...... 4 Non-Profit ...... 5 Geographical Area Analysis ...... 6 Economic Analysis Part 1 ...... 7 Economic Analysis Part 2 ...... 11 Political System ...... 16 Trade Laws and Legal Analysis ...... 18 Population ...... 19 Diet and Nutrition ...... 24 Housing ...... 27 Transportation ...... 30 Labor ...... 33 Education ...... 35 Clothing ...... 39 Recreation and Leisure ...... 40 Language ...... 41 Religion ...... 43 Bibliography ...... 45
Appendix ...... 49
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Thomas Stewart Peru
Peru is more than just another country among dozens of others. It’s a place where people can come alive, and where nothing is impossible. There is a certain spirit that whisks others off to a place of complete euphoria that none can match. In order to learn this, I had to do much studying and writing about Peru. Throughout my educational endeavors, I have found Peru to be a place of extreme variety and culture. I wasn’t sure what to expect at the beginning of this assignment, but I never thought that I would fall in love with this extraordinary country.
Obviously, some research was easier to do than other parts. And, of course, there were parts to the assignment that were more interesting than others. Doing research on all the different zones of information on Peru made the project more unbiased and real. I didn’t get to just focus on the tourist attractions, or the great food. I had to also look up how the political system works alongside what kind of tariffs are in place for certain imports and things of that nature. Not every little bit of info was pertinent to running a business in Peru, but doing all of the research painted a much clearer picture in my head of what to inspect instead of just focusing on one particular subject. Geography, combined with the economy analysis, and business etiquette made it clear that this was definitely the country where I wanted to base my non- profit organization.
Love and Orphan was an issue in Peru that hit a little close to home for me. I’ve always had a heart for children, and I can’t stand to see children suffering. My church currently partners with an orphanage in Peru and helps with a plethora of different things for them. This gave rise to the idea of basing my non-profit around this magnificent notion. I really do believe that children can and will change the world eventually. If you want to help out a country, you can’t just throw money at it. That may temporarily fix a few issues, but if you take the time and effort to help the kids with things like education and financial stability, then you will have put something in to motion that others would be hard pressed to stop. Not only that, but the Bible clearly states that we are to care for orphans and widows more than once. I figured that orphans in other countries, such as Peru, were a lot worse off than the ones in the U.S. That is why the perfect non-profit organization for me is Love an Orphan.
What sets apart the orphanages in Peru is really quite simple. The children in orphanages like the Posada de Amor have no chance of being adopted. They stay at the orphanage until they are adults. This is not the case for every orphanage in Peru, but this isn’t the only establishment like this. There are pros and cons to such an arrangement, but I believe that it is my duty to make sure that the kids have all the opportunities in the world there. The idea of a non-profit organization is to aim high and shoot for the star. This is why I decided to include orphans that don’t live in orphanages into my plan. I believe that those kids often get overlooked and need support sometimes just as much as kids living in orphanages. I have no doubt that Love an Orphan can make a difference. I’ve done the research. I’ve done the work. I have a vision. Now, all we need are people to rally behind it.
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Thomas Stewart Peru
Generally, most people think of the rich people as the most important. Some like to think that the old people are the most important because of their wisdom. What people clearly don’t see is that the children of today’s world will be the entire population tomorrow. Peru’s children need help. There are over half a million children in Peru that are orphaned at this moment. This extremely limits their potential for a bright future and a successful life.
There are about 550,000 Orphans in Peru right now. (www.unicef.org) Not every orphan in Peru is parentless. Orphans are defined as having lost one or more parents. This shows that not every orphan needs adoption, but every orphan needs help. Being a single parent with at least one kid, especially in Peru, is not an easy task. The term “single orphan” was developed to differentiate a kid who lost one parent from a “double orphan” who lost both. Not every orphan in Peru needs shelter, or foster parents, or anything of the sort. Some of them need money for food, education, and whatever else the family is struggling with to provide for their children.
The number one problem associated with orphans is emotional hurt. Children are the most fragile when it comes to feelings and losing one or both parents can serious damage a child. A lot of people overlook the hurt that these orphans go through, but it is important to keep in mind when dealing with or about them. The second major thing that they go through is poverty. Over 50% of the people living in extreme poverty in Peru are children. (www.friendsoftheorphans.org) A child obviously can’t work, so they can’t provide themselves with a steady income. Also, if a kid loses one parent, then it is solely up to the second parent to provide for all of their family. If it is the father that the family loses, then it is that much more difficult to stay afloat financially.
The obvious question here is why should people care? There are a lot of other issues in the world, and no one can pay attention, let alone do something, about them all. Most people probably don’t need too much convincing when it comes to children, but a large amount of people need to leave their safe little bubble of a life and truly think about what these kids are going through. Americans are extremely blessed to not have a single ounce of poverty. The poorest in the United States are nothing compared to the poorest in other countries such as Peru. The bible clearly states that all people should take care of orphans in Psalm 82:3-“Give justice to the poor and the orphan; uphold the rights of the oppressed and the destitute.” These poor children deserve our sympathy, and much more. If a group of people were to rally behind the Peruvian youth, it would benefit the entire country forever by helping tomorrow’s population.
There should be help offered to all that need it, but children should take first priority when providing aid. There is a problem in Peru, and someone needs to do something about it. Love an Orphan is non-profit organization that deals with helping Peruvian orphans by supplying them with what they need alongside with love. The outline of this organization can be found in the next section.
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Thomas Stewart Peru
Love an Orphan
Providing for the needs of orphans and their families while showing them love.
The premise behind our non-profit organization is to provide for the needs of orphans. One of the major needs of orphans is orphanages. Our organization builds orphanages in Peru in places that need them the most. We also pay the wages of those who work at the orphanages in order to ensure that the children are looked after properly. Our funds go towards supplies for school to enable the children to become successful in school, and in turn, successful in life.
Since not all orphans are in need of an orphanage, we have put together programs for families of children that have lost a parent. There are multiple different grants that we give out that are dependent on different factors of the family’s living position. Elements such as current income, number of children, and location determine the amount of money distributed to the family of orphans.
Donate Money - Non-profit organizations run on money, and we cannot change the world without some fuel for the fire. Donate Time - Come on down to Peru with us and help our cause! Whether it’s building, teaching, or loving the kids, your presence will make a difference. Pray - Prayer is powerful and can accomplish a multitude of different things.
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Thomas Stewart Peru
Peruvian Government: The government in Peru has been much more than sympathetic for our organization and our cause. Without them, the Love an Orphan would have sunk from the beginning.
Posada de Amor: This is a current orphanage just outside of Lima. They have agreed to help us in our endeavors, and are currently housing our temporary base of operations in the country.
Home Depot: They have agreed to donate some supplies to our organization, and have promised to donate more depending on the organizations success in the future.
What makes a country ideal for establishing a non-profit organization? Location is huge when it comes to importing and exporting. Climate can make or break a company based on harsh weather environments. Topography is equally important when it comes to traversing large bodies of water or mountain ranges. Separately, these things are fairly minor whether it helps or harms your industry, but together location, climate, and topography are the most important variables that you could consider.
Peru is situated on the eastern coast of South America. The location of Peru offers excellent benefits for us since it shares a border with Brazil. Brazil would be our tie to the rest of the world because it is swiftly rising as a world power. That means any amount of goods or resources could be purchased nearby without having to send supplies from the U.S. Although Brazil will be a vital asset, there aren’t very many other surrounding countries that have much to offer. Peru also borders the Pacific Ocean which is good for importing via ship. Being positioned on the border, Peru will have mostly tropical temperatures, but the climate has much more to offer.
Most countries caught between the northern and southern hemispheres are limited to merely hot, tropical climates. Peru is an excellent exception to this. It not only contains tropical jungle climates, but also has frigid temperatures in the highlands. Coastal temperatures are more moderate with it usually lying in between 12o C and 30o C (Google.images.com) 6
Thomas Stewart Peru
(languagecrossing.com). The one thing that is constant no matter where you go in Peru is the beauty. The rainforest jungles, high peaks of the Andes, and the Peruvian beach all have a natural splendor that takes your breath away.
When it comes to topography, Peru is tops. It is not like other equatorial countries. It has a diverse climate throughout the 496,225 sq. miles it encompasses (en.wikipedia.org). The great Andes Mountains loom over the local citizens. The Andes run straight down the middle of the country. This could prove to be problematic when shipping within the country. They run almost directly in the center of Peru which cuts it in half. This could slow or perhaps even halt shipments within the country, especially in winter. In contrast, shipping to and from Peru will be relatively easy since it borders the Pacific Ocean on the west side. The most dominating piece of landscape that Peru has to offer is easily the Amazon Rainforest. It covers a majority of the nation, which is pretty significant because Peru is the 20th largest country in the world (www.cia.gov). There have been issues in the past about deforestation legal or not. That in itself is not a good thing, but it just shows you how many natural resources lie in Peru. Along with timber, there are innumerable other resources that would be at our disposal. Just a few are copper, silver, gold, petroleum, fish, iron ore, coal, phosphate, potash, hydropower, and natural gas.
Natural resources Borders ocean Diverse regions Varying climate
Capitalist with socialist tendencies.
Private investments around the country (mostly along the coast) have helped the economy grow at an alarming rate. Ollanta Humala (president) has an administration that helps the citizens. The group is bent on staying committed to Peru’s free-trade path. It created indigenous and local disenfranchised groups (www.cia.gov).
Peru’s overall economy has been increasing exponentially. I guess you could say “business is booming”. The economy has been averaging a growth rate of 6% and it was over 8% in 2010. Extracting natural resources makes up 60% of total exports. The world’s demand for such
7
Thomas Stewart Peru resources is a major contribution as to why Peru’s economy has been improving. This is not as stable as one might think though. The prices of minerals, timber, and other resources are dependent on the rest of the world and scarcity (www.progressio.org.uk).
(NR) = Non-renewable (R) = Renewable
Oil (NR) - A Natural Gas (NR) - A Other Resources combustible liquid combustible mixture -Copper (NR) that is used for of gases that is -Gold (NR) light, lubrication, mostly used for fuel. -Zinc (NR) and heat. -Production- 7.24 -Tin (NR) -Production- billion cu m -Iron ore (NR) 158,300 bbl/day -Export- 3.59 billion -Molybdenum (NR) -Export- 73,280 cu m -Coffee (R) bbl/day -Consumption- 3.65 -Potatoes (R) -Import- 88,080 billion cu m -Asparagus (R) bbl/day -Import- 0 cu m -Fruit (R) -Reserve- 345.5 -Apparel and textiles billion cu m (NR) -Fishmeal (R)
(www.cia.gov)
Mining-Digging minerals out of the ground. Metal fabrication-Building metal structures by cutting, bending, and assembling. Petroleum Extraction-Drilling and extracting petroleum out of the earth. Natural gas liquefaction-Transforming natural gas from a gas to a solid. Fishing-Taking fish out of the ocean…. Textiles-Weaving different materials into cloth. (www.cia.gov)
There are approximately 2.75 Nuevo sols (PEN) for ever US dollar (www.cia.gov).
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Thomas Stewart Peru
14,000
12,000
10,000
8,000
6,000
4,000
2,000
(siteresources.worldbank.org)
This graph shows how strong Peru’s currency is in view of different countries. It is not the most powerful country when it comes to PPP, but it isn’t the bottom of the barrel either.
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Thomas Stewart Peru
8
7
6
5
4
3
2
1
0 Peru Panama Colombia
(siteresources.worldbank.org)
In recent years Peru’s economy has been on the rise, so you can expect the growth rate to be increasing more in the years to come.
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Thomas Stewart Peru
7,000
6,000
5,000
4,000
3,000
2,000
1,000
0 Peru Panama Colombia
(siteresources.worldbank.org)
Peru falls short on this category compared to other nations, but this number has been steadily increasing recently. You can expect larger numbers in the future.
The following statistics give an overview of Peru’s economy that has been growing exponentially in the past few years.
Copper Gold Zinc Tin Iron ore Molybdenum Crude petroleum and petroleum products Natural gas Coffee, potatoes Asparagus and other vegetables
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Thomas Stewart Peru
Fruit Apparel and textiles Fishmeal
(www.cia.gov)
The majority of Peru’s exports are either mined or farmed. Over 60% of exports are from mines (www.cia.gov).
$43.83 billion
(www.cia.gov)
China 18.4%, US 16.1%, Canada 11.7%, Japan 6.6%, Germany 4.5%, Spain 4%
(www.cia.gov)
Petroleum and petroleum products Chemicals Plastics Machinery Vehicles Color TV sets Power shovels Front-end loaders Telephones and telecommunication equipment Iron and steel Wheat Corn Soybean products Paper Cotton Vaccines and medicines
(www.cia.gov)
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Thomas Stewart Peru
Peru has been importing more and more in past years. This is proof that the economy is picking up and beginning to take off.
$36.97 billion
(www.cia.gov)
Sales
U.S. China Brazil Ecuador Argentina
(www.cia.gov)
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Thomas Stewart Peru
US 19.5%
China 16.6%
Brazil 6.5%
Ecuador 5.2%
Argentina 4.8%
This info is not surprising. Peru trades with the two behemoth trade countries, and with bordering countries.
The biggest problem of scarcity in Peru is water. Peru isn’t a hot or dry country necessarily, but the problem comes from redirecting water flow. Irrigation ditches need to be implemented in the country in order to redirect rivers so the farmers can grow their crops. This is actually a very common problem in Peru that pertains to the entire rural population. The fact of the matter is that Peru has a sufficient amount of water, but it all runs into the ocean. The problem comes from being able to access this vital natural resource (http://www.progressio.org.uk).
The current deficit in Peru is -$2.267 billion.
-$2.267 billion as a deficit is a lot of money. This would turn away a lot of businesses looking to do business in Peru, but you have to read between the lines here. The entire world runs on debt and charging money that you don’t have. Look at the U.S., we have the most enormous debt in the entire world, yet we are considered the wealthiest nation. Compared to some other countries, Peru’s debt is nothing. The trade balance is not a reliable source of how stable the economy is (www.cia.gov).
For every U.S. dollar there is an equivalence of 2.75 Nuevo sols. This is not a particularly good exchange rate, but it has been changing in our favor the last few years. Selling things in Peru is not a wise investment looking at these numbers. However, if we pay for supplies and such locally, then our money would carry further than it would if we bought from the U.S. (www.cia.gov).
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Thomas Stewart Peru
Nuevo Sol (PEN) (www.cia.gov)
1 USD = 2.75 Nuevo Sol
6.00%
5.00%
4.00%
3.00%
2.00%
1.00%
0.00% Peru Panama Colombia U.S.
(www.cia.gov)
The fact that Peru is inflating faster than the U.S. shows that the Nuevo Sol is losing value faster than the USD. Peru is still more stable with its currency than similar economic countries.
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Thomas Stewart Peru
12.00%
10.00%
8.00%
6.00%
4.00%
2.00%
0.00% Peru Panama Colombia U.S.
(www.cia.gov)
This graph shows that Peru may not be the most economically sound country in the world, but its employment rate is higher than that of the U.S. This proves that business in Peru is commonplace, jobs are readily available, and there are a lot of people working.
Doing business in Peru should be fairly straightforward. It is a republic, so it contains an executive, legislative, and judicial branch. It shouldn’t be much different than doing business in America. The government should not be as much of an issue as transporting people and resources throughout the country.
Peru can be categorized as a democracy because it has been going through a democratization process that makes the legislative branch more powerful in order to balance out the previously unfair executive branch (en.wikipedia.org).
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Thomas Stewart Peru
Executive-The president of Peru is elected every five years. They cannot be immediately re- elected after their term. The president then decides who makes up the council of ministers.
Legislative-The legislative branch is kind of like our own. It is made up of 130 members of congress that have been given more power in recent years in order to maintain a steady balance of government. Congress members are also elected for 5 year terms. Just like America, congress ratifies treaties, and can be vetoed by the president.
Judicial-Made up of a 16 member Supreme Court, the Judicial Branch has the final say in the law of the land. Just like the other branches, it is extremely similar to America’s government (en.wikipedia.org).
Peru has many different political parties. One of the more interesting ones is the Shining Path party. It is basically just a fancy term for the communist party in Peru. They like to call themselves the Communist Party of Peru, or PCP for short. I thought this was quite comical. Abimael Guzmán has been the leader of this party since 1992 (en.wikipedia.org).
President-Ollanta Humala
Ollanta Humala also used to be a well-known military commander.
Prime Minister-Oscar Valdés
These two are really the only individuals that hold any real power. The rest belong to the congress.
(www.cia.gov)
Peru has been making excellent strides in getting their government even more stable than it was in the past. The executive and legislative branches are renewed with different people every half decade. Congress has also been given more power in order to balance out the power that the executive branch has. This allows people to have more of a say in the government than they did before (Wikipedia.org).
Peru has a civil law system (www.cia.gov).
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Thomas Stewart Peru
You have to be 18 to vote. This right is revoked once you turn 70 (www.cia.gov).
It is widely believed that the red in the flag represents blood from the people that fought for the independence of Peru. It could also be that the red signifies red flamingos that flew next to white clouds (wikipedia.org).
Much of the laws pertaining to imports and exports in Peru are very similar to what you would expect. The tariffs are fairly similar to the U.S. taxes, and they all range depending on the item. There is a wide array of different things that cannot be taken into the country, and a list of things that need to be restricted. It’s kind of like how you can only take 10,000 U.S. dollars in and out of the country until you need to declare more than that. Overall, the trade laws in Peru are nothing out of the norm.
Tariffs in Peru range from fairly low to pretty high. Animals seem to have low tax rates for importing and exporting compared to other things. A horse, for example has a 7% tariff, while certain types of clothing has around 20% depending on the type. Certain foods like figs or mushrooms have a 25% tariff, so it really depends on what you want to import or export to determine if the tariffs are high or low in Peru (explore.data.gov).
Pets are a big thing when it comes to restrictions in Peru. To have a pet cleared for transport it must have a veterinarian good health certificate along with vaccination certificates like rabies. You can bring money in and out of the country freely as long as it is under 10,000 U.S. dollars. If you have more than that in any kind of currency, you must declare the amount. If you are traveling with an animal, then it must not have eaten any bovine meat from a long list of certain countries.
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Thomas Stewart Peru
Importing into Peru costs about $80 more than it does to export. This deters a lot of people from importing things into the country. There also isn’t a ton of agricultural trades because the tariffs for crops have either a 5% or 10% added to the original tariff (peru.visahq.com). Some items don’t have restrictions like personal medicines. Restrictions for drugs are as follows: 20 packets of cigarettes or 5 cigars or 250 grams of shredded or threaded tobacco for smoking and 3 liters of alcohol. This, of course, only applies to people of at least 18 years of age. Only 5 visual cartridges are allowed per person. Whether it’s for a camera, camcorder, or other visual recording device (internationalbusiness.wikia.com).
The exports from the U.S. to Peru in 2009 added up to $4.9 billion dollars. 80% of the consumer and industrial U.S. exports are no longer subject to tariffs (trade.gov). Ninety percent of agricultural U.S. exports are also exempt from tariffs in Peru. This proves that America has a huge impact on Peruvian culture, and that our country becomes a necessity when it comes to foreign trading (export.gov).
Per every 1000 people in Peru, 5.95 die every year. About 77 % of the total population is urbanized, and this number is growing by approximately 1.6% yearly. This is a great benefit to us because the country obviously isn’t a bunch of 3rd world tribes littered everywhere. Although there are a fair amount of them, the majority of the nation is organized to a point where our business would flourish. The official language of Peru is Spanish. About 84.1 % of Peruvians speak Spanish. Other languages in the country include: Quechua (13%), Aymara (1.7%), Ashaninka (0.3%), and other native languages (www.cia.gov).
29,549,517 (www.cia.gov)
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Thomas Stewart Peru
2.5
2
1.5
1
0.5
0 Peru Afghanistan Nepal
Peru-1.016%
Afghanistan-2.22
Nepal-1.77
(www.cia.gov)
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Thomas Stewart Peru
40
35
30
25
20
15
10
5
0 Peru Afghanistan Nepal
Peru- 19.13%
Afghanistan- 39.30%
Nepal- 21.85%
Peru has the lowest birth rate when it comes to contrasting it with multiple similar countries. I believe it is because the majority of Peru is not urbanized yet. Urban settings tend to have more children than rural. The life expectancy in Peru is also noticeably high, so there is no feeling amongst Peruvians to repopulate at a large rate (www.cia.gov).
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Thomas Stewart Peru
80
70
60
50
40
30
20
10
0 Peru Afghanistan Nepal
Peru- 70.78 years
Afghanistan- 48.45 years
Nepal- 65.26 years
Peru has the highest life expectancy when it comes to comparing it to other like countries. Afghanistan is a dangerous place to live, so it is understandable why the life expectancy is so low there. Peru beats out Nepal, but not by much. They are very similar in the sense of life expectancy (www.cia.gov).
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Thomas Stewart Peru
2.5
2
1.5 Female Male 1
0.5
0 At Birth Under 15 15-64 Years 65+ Years Total Years Population
Ratios:
At Birth- 1.05 male(s)/female
Under 15 Years-1.03 male(s)/female
15-64 Years-0.96 male(s)/female
65+ Years- 0.9 male(s)/female
Total Population- 0.97 male(s)/female
This information tells us that the male/female ratio is about the same for all ages. If the numbers were farther apart or more drastic, the company could find a sales pitch strategy that would be slightly more favorable to that particular gender. Since they are about equal, there really is no sales tactic we can use based on this information (www.cia.gov).
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Thomas Stewart Peru
7,000,000
6,000,000
5,000,000
4,000,000
3,000,000
2,000,000
1,000,000
0 Lima Arequipa Trujillo Chiclayo Piura
1. Lima-6,321,173 2. Arequipa-619,156 3. Trujillo-509,312 4. Chiclayo-379,520 5. Piura-277,964
At first glance, Lima seems to blow every other city of the water for no good reason, but after taking a closer look a map, it’s obvious why Lima’s population is so immense. Lima, being the capital of Peru, and being placed on the coast gives perfect reason to back up these numbers. Most of the other cities are further inland, and people would have to do an extraordinary amount of travel to get to most of them (en.wikipedia.org).
Peru has many diverse crops that influence their food substantially. The three main foods in Peru are corn, chili, and potatoes. Peruvian culture has been shaped by many different outside countries such as Spain, Northern Africa, and China. Chifa is the Peruvian word for China. They try to substitute ingredients from their own country to make their own type of Chinese food. Overall, food from Peru has a reputation for being hot and spicy. Maize has also been a staple in Peru for many years (en.wikipedia.org).
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(Kilograms per person)
90
80
70
60
50
40
30
20
10
0 Peru Brazil Nepal
(worldinfozone.com)
As you can see, Peru isn’t the most vegetarian friendly country, but it doesn’t consist of 100% carnivores either. Meat consumption is usually tied to wealth, so it is a fair assessment that Peru is not extremely wealthy, nor extremely poor.
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Thomas Stewart Peru
(Percentage)
45%
40%
35%
30%
25%
20%
15%
10%
5%
0% Peru Afghanistan Nepal
Peruvian children are extremely blessed to have an abundance of food compared to these other countries (worldinfozone.com).
(kilocalories/person/day)
3500
3000
2500
2000
1500
1000
500
0 Peru Brazil Nepal
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Thomas Stewart Peru
Brazil has a few more kilocalories than Peru, but they are all fairly even. All countries are above the recommended calorie intake for either a man or woman (worldinfozone.com).
Housing and communication in Peru has been on the rise for over 2 decades. Urbanization and teledensity are two major aspects of Peru’s infrastructure that have been growing at an astonishing rate. There are many different regions in Peru that are more developed than others, but the growth rate has stayed fairly consistent.
The types of housing have a large array of diversity in Peru. The reed houses of the Uros tribe are exactly that: reed houses. They float on lakes and have to constantly add fresh reeds as the old ones decay. Housing comes in the form of regular houses, apartments, vecindads, or villas. Some are made of either bricks or mud. Mud houses made up 47% of all houses, 31% were made with bricks, 7% are clay, 7% are wood, and 5% are made of stone and mud. In 1993, there were 5,107,790 dwellings nationwide (www.hgpho.to).
.
Percentage of division of housing
88% detached or semi-detached houses
4% apartments
4% vecindads (semi-private dwellings)
3% villas
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2 1.8 1.6 1.4 1.2 1 0.8 0.6 0.4 0.2 0 Peru U.S. Israel Japan
(www.nationmaster.com)
This shows that Peruvian households either contain many more people than that of other countries, or the houses are considerably smaller. From prior research, the latter possibility is more likely.
29
Thomas Stewart Peru
80
70
60
50
40
30
20
10
0 Peru Afghanistan U.S. Nepal
(www.nationmaster.com)
The fact that Peru is almost as urbanized as America shows how developed the country is, and how the society is more industrialized than its neighboring countries.
Peru’s infrastructure has improved astronomically since the ‘90s. It has just under 2 million landlines, and just over 1 million cellular numbers. There are approximately 3 million televisions in the country. To put it in perspective, there are over twice the amount of radios than TVs, and the total population of Peru is 29 million people (www.google.com/publicdata).
There are at least 4 million internet users in Peru. The ratio for the population is relatively low, but it has been increasing exponentially over the last few years (thenextweb.com).
Transportation in Peru can be very difficult. Most people do not own automobiles, so walking long distances is a common occurrence. Two days of walking in order to get to a busy
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commercial city happens throughout the country. A lot of the villages do not even have roads going to them. There are not very many buses, but it is commonplace to hitch a ride with a truck driver that could possibly be transporting animals or goods (http://www.midwestaugustinians.org).
(www.google.com)
90,000
80,000
70,000
60,000
50,000
40,000
30,000
20,000
10,000
0 National Departmental Local
(www.cia.gov)
There isn’t information on paved vs. unpaved roads, and you can see that there are far more local roads than commercial government roads. A lot of places in Peru don’t even have roads that go to them (www.cia.gov).
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Thomas Stewart Peru
9,000 8,000 7,000 6,000 5,000 4,000 3,000 2,000 1,000 0 Water Railways
(www.cia.gov)
Trains are almost never used in Peru, but there are lots of opportunities to take to the water.
60
50
40
30
20
10
0 Major Ports Paved Airports (www.cia.gov)
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Thomas Stewart Peru
Most of the airports in Peru are small, and the ports are fairly large. According to this data, air travel is probably going to help out a company a lot more than ships. Airplanes are also faster and more versatile in where they can go.
In order to attain a job in Peru, one must follow similar procedures to the U.S. You can either go job hunting to work for someone, or you can become self-employed. A lot of Peruvians choose the latter because they can make their own money doing things such as taxi driving, window washing, or setting up shops or stalls as a vendor (www.everyculture.com). Age restrictions for work are around 14-18 years of age, but are commonly overlooked. Employees don’t have a big say in things, but when the government tried to undercut the labor unions in wages, the people had no choice but to go on strike if they wanted a fair wage. The employees do have a say in things, if it comes down to being serious enough (countrystudies.us). There are such things as benefits in Peru, but they are shaky at best. They are constantly changing, so there is no solid promise of getting retirement benefits, or anything of the sort. Lack of doctors and nurses has also negatively impacted national health programs. There is definitely a racial hierarchy in Peru. Even though they take up a mere 10% of the population, whites are usually at the top of the chain when it comes to schooling and social structure. There is nothing like affirmative action in Peru, so it’s hard for ethnic groups other than whites to break free of the low class without proper schooling (www.everyculture.com).
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Thomas Stewart Peru
12.00%
10.00%
8.00%
6.00%
4.00%
2.00%
0.00% Male Female
(www.nationmaster.com)
Traditionally, most of the world sees the male as the main financial contributor for households. That is probably why the females in Peru are slightly less employed than the males.
The majority of the occupations in Peru are services. Services meaning: jobs done for other people, not necessarily making a product or creating or exporting anything. The divisions of occupations are as follows: agriculture 5.9%, mining and quarrying 0.4%, manufacturing 12.6%, construction 5.3%, commerce 26.3%, household work 4.9%, other services 44.6%. Although the mining and quarrying industry makes up for most of the country’s exports, it doesn’t make very many jobs for the populous. By looking at the statistics, it’s obvious that the services industries are what create jobs for the majority of the people.
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Thomas Stewart Peru
45.00% 40.00% 35.00% 30.00% 25.00% 20.00% 15.00% 10.00% 5.00% 0.00%
(www.nationmaster.com)
Even though mining accounts for the majority of Peru’s exports, it does not hold a high percentage for all the industries in the country.
The average workday in Peru varies on the person and occupation. It is not out of the ordinary to average a 48 hour work week, but some people work about 12 hour days (www.solidaritycenter.org). Attire also depends on the job, but it is normal to wear a suit and tie when working in a business environment. Some holidays provide the day off for workers, but it is almost impossible to find anything open on Sundays (www.lonelyplanet.com). It is important when meeting people in a business environment to have a good handshake. Women are to extend their hand before the man, and you must not break eye contact. Business is conducted every day from 8 a.m. to 6 p.m. except for Sundays (www.ehow.com).
Peru’s educational system is a little different than that of the U.S. The average amount of schooling that an adult gets is 7.6. Compare that to America’s 12 years, and you can see a
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Thomas Stewart Peru pretty substantial difference. Peruvian schooling is free, even public universities if you can’t pay tuition and have decent grades. You have to attend primary and secondary educational institutions. Primary schooling is 1st through 6th grade. Secondary education is 5 years of high school. After primary schooling, parents have the choice of sending their kids to public or private schools (www.nationmaster.com).
180.00% 160.00% 140.00% 120.00% Tertiary 100.00% Secondary 80.00% 60.00% 40.00% 20.00% 0.00% Peru U.S.
Secondary education is commonplace in Peru, but tertiary is not quite as normal. A lot of Peruvians don’t continue their education because they must join the work force.
Peru
Enrollment ratio (secondary): 61.5%
Educational attainment (tertiary): 28.8%
U.S.
Enrollment ratio (secondary): 88.1%
Educational attainment (tertiary): 72.6%
(www.nationmaster.com)
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Thomas Stewart Peru
100 90 80 70 60 50 40 30 20 10 0 Peru U.S. China Germany
This graph shows that Peru can keep up with the best of the best when it comes to population literacy and education.
Peru - 92.9%
U.S. – 99%
China - 92.2%
Germany – 99%
(www.nationmaster.com)
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Thomas Stewart Peru
12
10
8
6
4
2
0 Peru U.S. China Germany
The U.S. has a lot longer school life than most other countries. Peru is not necessarily lacking in the education department, they just pale in comparison to the lengthy U.S. school life.
Peru - 7.6
U.S. - 12
China - 6.4
Germany - 10.2
(www.nationmaster.com)
I was surprised at how close the Peruvian education system is to the other countries I compared it to. The common theme throughout the statistics is that the U.S. and Germany are “better” than Peru, but China is “worse”. The years that you are in school doesn’t necessarily tell you how educated the students become. The literacy rates were much higher than I anticipated, and it seems like Peru has a sound foundation for education.
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Thomas Stewart Peru
Much like the United States, Peruvian business attire is fairly formal. A suit and tie is expected, and shiny shoes are not uncommon. Although Peru is noted for being more relaxed with their business and meetings, formal attire is expected throughout the majority of the country. It is expected that women also appear professional with either slacks or a skirt (www.executiveplanet.com).
Expected Visitors Attire-It is highly recommended that tourists bring a lot of light clothing that they can layer on top of each other instead of one big coat or jacket. The climate in Peru is drastically different depending on where (www.google.com) you go, so being able to peel off a layer or two is extremely beneficial.
Casual Attire-The entire culture in Peru is a lot more laid back than the U.S. There aren’t very many guidelines on what is acceptable and what isn’t, but if you overdress, then you will look out of place (www.journeywoman.com).
Peru is known for all of its tourist attractions, right? Not exactly, but there are a few things that some people don’t realize Peru has to offer. A lot of people think solely of Machu Picchu when it comes to Peru, but it has so much more to offer than that. Peru contains a plethora of fun and adventurous activities that will entice anybody and everybody. Besides Machu Picchu, the most luring experiences await with Lake Titicaca and the Nazca Lines. These three primarily make up for a large chunk of tourism, and for good reason.
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Thomas Stewart Peru
Machu Picchu is an ancient city in Peru that draws in awestruck viewers on a daily basis. This city was untouched by the Spaniards when they were conquering Peru, and it has been left alone, untouched by human hands, for a long time. This mystical place is the best archaeological site in the country. This relic of a city is so popular among tourists that they have to limit the amount of people that can make the trek up there to 2500 people (www.lonelyplanet.com). Although some of the structures have been reconstructed in order to get a better feel of how it looked back in its heyday, it still manages to take visitors back in time. A very fascinating point of interest at this location is the Intihuatana stone. Believed to be some sort of astronomic calendar or clock, this intricate design of stones matches up with the sun exactly on the winter solstice (en.wikipedia.org).
Located on the border between Bolivia and Peru, Lake Titicaca is the largest lake in South America. This lake is the highest in elevation that is commercially navigable in the
entire world. Five major river systems (about 27 rivers) flow into it, and all water exits through one river. So what’s the big deal about a big lake anyway? Are there genetically mutated fish/bird hybrids that attract people to this large body of water? The reason that this lake is a tourist attraction may surprise you. There are 6 major islands on this lake. Here’s the catch: some islands are made from reeds, and they are free floating on the water’s surface. The Uros people who are indigenous to Peru initially constructed these phenomena in order to escape their aggressive neighbors (en.wikipedia.org). If anyone misbehaved or broke a tribal law, the Uros people would cut them off from their society. Literally. They would cut away at that section of reed until that chunk was separated from the rest of the island. The purely strangeness of the idea in itself is enough to get multitudes of people to go and see it.
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Thomas Stewart Peru
The Nazca Lines are truly a marvel to behold. They are large designs on the Nazca Desert that have baffled numerous archeologists around the world. Some pictures are believed to have been used for a ritual for fertility or rain. There have been disputes about their origin, and even whether or not extraterrestrials were involved (en.wikipedia.org). At ground level, there is nothing substantial about lines on the ground, but to truly experience the awesome sight, one must take to the skies. Be warned, the planes that give tours over these pieces of ancient art are a bit cramped. The Nazca Lines are a must see for anyone traveling to Peru.
There are a myriad of other attractions that pull people in throughout Peru, but these three are the ones that one would be hard pressed to pass up. The grandeur of these sights are well more than enough to change someone’s life. There is so much rich history in the soil (or water) of this country, that is practically begging for others to come and enjoy it.
A valid passport is required for entering/exiting the country. No immunizations are needed, but a vaccination against Yellow Fever is recommended. Tourists must provide proof of return, and a document will be given for an approved 90 days. There are no extensions, and fines are in place for overstays.
(travel.state.gov)
Spanish is the most prominent language in Peru. It is very important that a majority of the businessmen that we send over there speak Spanish. I know that the global business language is English, but we need to be able to speak fluently with the indigenous populous. Nothing kills a business faster than a communication barrier, but fortunately, Spanish is a common second language for people in the U.S. Quechua is also an official language, so it is important for someone to be able to communicate with that small percentage of the population.
(www.cia.gov)
Spanish 84.1%
Quechua 13%
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Thomas Stewart Peru
There are a plethora of minor languages spread throughout the country. These are the two major ones. The rest of the languages make up under 1% of languages spoken.
Aymara-661,000, Lake Titicaca area toward the ocean.
Asháninka- Apurimac, Ene, Perene, Tambo rivers and tributaries.
(www.ethnologue.com)
1200
1000
800
600
400
200
0
(www2.ignatius.edu)
Spanish is the 3rd most spoken language in the world, so Peru is able to communicate and therefore trade with many different countries.
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Thomas Stewart Peru
25.00%
20.00%
15.00%
10.00%
5.00%
0.00%
(www2.ignatius.edu)
Spanish is extremely influential, probably because Spain had a huge impact on the world with their conquests. This is beneficial to Peru because it means that a lot of countries share the same culture.
Like the majority of Spanish speaking countries, the majority of the population in Peru is Christian. Catholicism is big in Spanish culture, and that makes up about 81% of the people in Peru (www.cia.gov). Peruvians are very religious, and it is required that all school curriculums teach catholic beliefs and values. Religious symbols are also found in all government buildings (en.wikipedia.org).
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Thomas Stewart Peru
90.00% 80.00% 70.00% 60.00% 50.00% 40.00% 30.00% 20.00% 10.00% 0.00% Roman Catholic Evangelical Other Unspecified or None
The Spanish brought their Roman Catholic beliefs with them to Peru when they visited in the 1500’s. They planted many churches during that time period (www.mapsofworld.com).
The amount of evangelical Christians in Peru has tripled in number since the 1990’s. There are about 4 million in Peru and are constantly on the rise every year (www.peruoutreach.com).
:
About 80% of the population in Peru is Roman Catholic, but a large majority of them are “inactive”. That means that they are not regularly practicing or don’t’ attend mass on a consistent basis. The statistics between Roman Catholics and Evangelical Christians are substantially different, but the amounts of practicing people are about equal. Even though most people don’t practice their religion regularly, it is still a huge part of the culture. The Peruvian constitution declares religious freedom, but all government building haves catholic symbols in them. We have to be extremely careful not to offend the locals with anything that is frowned upon in the Christian culture (www.peruoutreach.com).
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"Central Intelligence Agency." CIA. Web. 16 May 2012.
"Countries and Their Cultures." Culture of Peru. Web. 16 May 2012.
"Education in Peru." Wikipedia. Wikimedia Foundation, 15 May 2012. Web. 16 May 2012.
E/F84XVII5), "Persons Per Room by Country", United Nations Secretariat and United Nations Centre
for Human Settlements (Habitat), Compendium of Human Settlement Statistics 2001 (United Nations Publication, Sales No E01XVII5), Compendium of Human Settlement Statistics 1995 (United Nations Publication, Sales No E95XVII11) and United Nations, Compendium of Human
Settlements Statistics 1983 (United Nations Publication, Sales No. "Persons per Room Statistics - Countries Compared." NationMaster.com. NationMaster. Web. 16 May 2012.
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Thomas Stewart Peru
Ellen, Karen. "Tips for Business Etiquette in Peru." EHow. Demand Media, 12 Aug. 2009. Web. 16 May 2012.
"Floating Island." Wikipedia. Wikimedia Foundation, 05 Sept. 2012. Web. 16 May 2012.
May 2012.
"Machu Picchu." Wikipedia. Wikimedia Foundation, 16 May 2012. Web. 16 May 2012.
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"Nazca Lines." Wikipedia. Wikimedia Foundation, 15 May 2012. Web. 16 May 2012.
"Peruvian Labor Profile." NationMaster.com. NationMaster. Web. 16 May 2012.
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"Search." Peru. Web. 16 May 2012.
"Urbanization Statistics - Countries Compared." NationMaster.com. NationMaster. Web. 16 May 2012.
"World InfoZone - Peru Information - Page 1." World InfoZone - Peru Information - Page 1. Web. 16 May 2012.
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It is not uncommon to be a half hour to an hour late for a meeting. Some people call it “Peruvian Time”, because Peruvians are known for never being on time. It is considered rude to switch between the hands you use for utensils while eating. Forks are supposed to be held in the left hand, while knifes are to be held in the right. (www.ehow.com) It is considered extremely rude to walk into someone’s office without an appointment. Meetings are to be scheduled prior. (www.expatperu.com) If you are invited to dinner, you must bring a gift of some sort. Desserts are usually a common present. Always ask before taking a picture of a building or person. A lot of buildings don’t allow pictures because they are either owned by the government or are related to religious purposes. (www.munich-business-school.de)
Thomas Stewart BIS Inc. 655 North Third Central Point, OR (541) 494-6300
February 22, 2012
Dr. Johnny Allen Hendrix Human Resources Director BIS Inc. 845 United Nations Plaza New York, NY 10017
Dear Dr. Hendrix:
It is an honor and a pleasure to work at this company, but I know of a way to make it even better. I have concocted a business opportunity to launch a non-profit organization campaign to provide for a country that is in need of support. There are a copious amount of countries in the world that could use our aid, but I have taken the initiative to narrow the list down to three.
There are many different countries that appeal to me, but Peru is the most enticing. I am planning on visiting Peru this summer. My church sponsors an orphanage there, and my family is going to travel there to help orphans in early August. I would love the opportunity to research this country before I go there. I have the upper hand on others who are requesting Peru because I can talk to
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Thomas Stewart Peru individuals who have been to Peru in the past and can give me insight about the Peruvian lifestyle and atmosphere. I could tie in my non-profit program to the orphanage I am going to. The orphans there are part of the future of the country. They have no hope of being adopted, and stay there until they are adults. The orphanage is in need of repair, and the kids just need someone to love on them. Of the 3.8 million people living in extreme poverty, 2.1 million are children. The estimated count of children who have lost at least one parent in Peru is approximately 550,000 children. My non-profit organization will accumulate money to help pay for construction and repair projects for orphanages like the one I’m visiting.
My second choice is Uganda. I’ve heard of some terrible money and health issues the country is facing, and I would love to research more. One of my friends is going to Uganda to help at a hospital and put IV’s in people. This makes the country more appealing as well. Just like Peru, I have connections to people who have been to Uganda before, and they could help me understand information the computer just can’t do. Poverty is the main problem in Uganda. Most sick people in Uganda go without treatment because of the minute number of doctors. The doctor/patient ratio is about 1:20,000. There is an immense demand for medical attention in this country, and we can make a difference for a plethora of people.
Finally, Spain draws my interest. You probably know my foreign exchange student, Samuel. He has described to me what Spain is like, and it has peaked my interest to learn more. I could understand more of the background where Samuel came from. Just like the other two, I could get a firsthand experience about Spain. This account would probably be in a lot more detail than the others since Samuel actually lives there. I recall Samuel talking about how terrible the unemployment rate is there. Roughly 5.8% of Americans don’t have jobs, but that’s nothing compared to Spain. The unemployment rate in 2011 was last recorded as 22.85%! My non-profit organization would address this by establishing small convenience stores throughout the country. Fundraising would go towards constructing these shops, purchasing stock supplies, and transporting these resources to Spain. The profit from the shops would cover the payment of the workers. It is a big job, but great things happen when communities come together to help people in need.
If you have any concerns you can reach me at (541) 494-6300 or my email, [email protected]. If I do not hear back from you within a week I will call. Thank you for taking time out of your day.
Sincerely
Thomas Stewart International Market Research Specialist
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