Peru’s dramatic rise from market pariah to investors’ darling was capped this year with investment-grade status awarded by Standard & Poor’s and Fitch, opening Peruvian capital markets to huge interest among institutional investors. Ironically, Alan García, the president who made Peruvian debt a no-go area in the 1980s with soaring inflation and bond defaults, oversaw the upgrades in his second term, two decades later as a free-market convert.
With low inflation, one of Latin America’s fastest economic growth rates at 9% this year and a free-trade agreement with the US, Peru hopes to develop its nascent corporate and local-currency bond markets and create the kind of secondary trading and asset-backed transactions that are rarely seen outside Brazil and Mexico in the region.
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