A brief economic boom causes imports to rise significantly in response to domestic demand. Despite a return to a policy of export-led growth, Peru's exports remain low. The external current account falls from a slight surplus to a deep deficit.
Fujimori overturns trade policy to reintegrate Peru into the world trade and financial systems. Direct quantitative restrictions on imports are lifted. Wildly dispersed tariff rates are consolidated at three lower levels ranging from 15 to 25 percent. Peru is a founding member of the WTO. The government emphasizes a raw-material export model, offering incentives to capital-intensive investments.
Economic recession and El Niño cause a drop in exports. A parallel decline in imports narrows the trade gap. Peru enters a customs union with other Andean countries. Development of natural gas fields promises an energy surplus that Peru hopes to export to neighbors. Peru sells its primary exports (fish products, minerals, agricultural products, and textiles) mostly to the U.S., China, and Japan.
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