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Egypt is the second-largest economy in the Arab World, with a GDP in excess of $229bn and a domestic market of 85m people. However, its performance over the past year has been turbulent, thanks to the significant political transformation the country has undergone. The complicated process has had broad macroeconomic consequences for Egypt, reducing capital inflows by roughly 75% in 2011 and slowing GDP growth to less than one-third of what was originally forecast for the 2010/11 fiscal year. During the same period, the government deficit grew to 9.8% and foreign reserves declined, even as spending pressure increased. However, the long-term fundamentals of the country’s diversified economy remain strong and some segments posted remarkably robust figures. This chapter features interviews with Osama Saleh, Minister of Investment; Gamal Moharam, President, American Chamber of Commerce in Egypt; John Rice, Vice-Chairman, General Electric; Hassan Malek, Chairman, Egyptian Business Development Association; Mohamed El Erian, CEO, Pacific Investment Management Company; and Hisham El Khazindar, Managing Director and Co-founder, Citadel Capital.

The mobile segment has been responsible for driving growth in Peru’s telecoms sector, which expanded by 16.4% in 2011. While growth in 2012 is expected to cool down, new revenue streams from sources such as mobile data will continue to make the sector an important source of foreign direct investment. Meanwhile, with internet teledensity in the country still relatively low, at 4.39% in 2011, the IT sector will require more research and development initiatives, particularly to expand into rural areas, where less than 1% of all households have an internet connection. The government has laid out a new plan that will bring internet to all public schools in the country by 2016, which will raise teledensity to 12.7%. This chapter includes a dialogue between Miguel Rivera, President, Nextel; and Javier Manzanares, President, Telefónica.

In 2010 Peru was among the world’s top 10 producers of a variety of minerals, among them gold, silver, copper, lead, zinc, tin and mercury. Commodity prices of copper and gold have kept revenues high despite a decline in production over the last several years. Exports increased from $3.2bn in 2000 to $21.7bn in 2010, posting average annual growth of 58% during that period. While the mining industry has had to struggle with issues such as illegal mining, which has caused tremendous damage to the environment, as well as with the negative effects of the sector on indigenous populations, the government is working to strike a balance in development, legislating for consultation with local groups before licensing new projects. This chapter features interviews with Pedro Martínez Carlevarino, President, National Society of Mining, Petroleum and Energy; and Roque Benavides, Chairman & CEO, CIA De Minas Buenaventura.

The exploitation of the Camisea natural gas field has attracted investors to Peru and caused the country to look more closely at the potential of its hydrocarbons industry. The government has also turned its focus to oil production, with state-owned energy company Petroperú stating it hopes to triple oil production over the next four years and thereby turn Peru from a net importer of crude to a net exporter. The country is also adding hydroelectric generating capacity with private investments, thereby bringing electricity to more rural areas. While the government is obviously dedicated to developing its energy sector, it also must address a number of social conflicts – which involve the effects of hydrocarbons projects on indigenous populations, as well as environmental concerns. This chapter includes an interview with Jorge Merino Tafur, Minister of Energy and Mines.

OBG introduces various aspects of the Peruvian legal system, in cooperation with its local legal partner, Estudio Echecopar. This chapter includes a viewpoint from Javier Tovar Gil, Partner, Estudio Echecopar.

Together with PwC, OBG explores and clarifies Peru’s tax system, paying special attention to policies for foreign investors. This section also includes a viewpoint from Miguel Mur, Latin America Tax Leader, PwC.