Peru’s gross domestic product in the late 1980s was $19. 6 billion, or about $920per capita. Although the economy remains primarily agricultural, the mining andfishing industries have become increasingly important. Peru relies primarily on theexport of raw materialschiefly minerals, farm products, and fish mealto earnforeign exchange for importing machinery and manufactured goods. During thelate 1980s, guerrilla violence, rampant inflation, chronic budget deficits, anddrought combined to drive the country to the brink of fiscal insolvency. However,in 1990 the government imposed an austerity program that removed price controlsand ended subsidies on many basic items and allowed the inti, the nationalcurrency, to float against the United States dollar.Order now
About 35 percent of Peru’s working population is engaged in farming. Mostof the coastal area is devoted to the raising of export crops; on the montaa and thesierra are mainly grown crops for local consumption. Many farms in Peru are verysmall and are used to produce subsistence crops; the country also has largecooperative farms. The chief agricultural products, together with the approximateannual yield (in metric tons) in the late 1980s, were sugarcane (6.
2 million),potatoes (2 million), rice (1. 1 million), corn (880,000), seed cotton (280,000),coffee (103,000), and wheat (134,000). Peru is the world’s leading grower of coca,from which the drug cocaine is refined. The livestock population included about 3. 9 million cattle, 13.
3 millionsheep, 1. 7 million goats, 2. 4 million hogs, 875,000 horses and mules, and 52million poultry. Llamas, sheep, and vicuas provide wool, hides, and skins.
The forests covering 54 percent of Peru’s land area have not beensignificantly exploited. Forest products include balsa lumber and balata gum,rubber, and a variety of medicinal plants. Notable among the latter is the cinchonaplant, from which quinine is derived. The annual roundwood harvest in the late1980s was 7.
7 million cu m. The fishing industry is extremely important to the country’s economy andaccounts for a significant portion of Peru’s exports. It underwent a remarkableexpansion after World War II (1939-1945); the catch in the late 1980s was about5. 6 million metric tons annually. More than three-fifths of the catch is anchovies,used for making fish meal, a product in which Peru leads the world. The extractive industries figure significantly in the Peruvian economy.
Peruranks as one of the world’s leading producers of copper, silver, lead, and zinc;petroleum, natural gas, iron ore, molybdenum, tungsten, and gold are extracted insignificant quantities. Annual production in the late 1980s included 3. 3 millionmetric tons of iron ore; 406,400 metric tons of copper; 2054 metric tons of silver;203,950 metric tons of lead; and 612,500 metric tons of zinc. About 64. 9 millionbarrels of crude petroleum were produced, along with 578. 3 million cu m ofnatural gas.
Much manufacturing in Peru is on a small scale, but a number of modernindustries have been established since the 1950s along the Pacific coast. Traditional goods include textiles, clothing, food products, and handicrafts. Itemsproduced in large modern plants include steel, refined petroleum, chemicals,processed minerals, motor vehicles, and fish meal. In the late 1980s Peru had an installed electricity-generating capacity ofapproximately 3.
7 million kw, and annual output was approximately 14. 2 billionkwh. About three-quarters of the total electricity produced was generated inhydroelectric facilities. The unit of currency in Peru is the inti, divided into 100 cntimos; afterbeing allowed to float against the U. S. dollar, the inti fluctuated wildly at between200,000 and 400,000 to the dollar in mid-1990.
The Banco Central de Reserva delPer (1922) is the central bank and bank of issue. All private domestic banks werenationalized in 1987. Exports are more diversified in Peru than in most South American countries. Theprincipal exports are petroleum, copper, lead, coffee, silver, fish meal, zinc, sugar,and iron ore.
The chief export markets are the United States, Japan, Germany,Belgium, Luxembourg, Italy, and Great Britain. Exports earned about $2. 7 billionannually in the late 1980s. The leading imports of Peru include electrical andelectronic items, foodstuffs, metals, chemicals, and transportation equipment. Theprincipal sources of these goods are the United States, Japan, Argentina, Germany,and Brazil. Imports cost about $2.
8 billion annually in the late 1980s. Peru’s system of railroads, highways, and airports has been expandedconsiderably since World War II. The country’s mountains make surface transportdifficult, however. In the late 1980s Peru had about 69,940 km (about 43,460 mi)of roads, of which 11 percent were paved.
The main artery is a section of the .