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February, 2015
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Australia-Peru to strengthen ties
N
ew Australian Ambassador to Peru
Nick McCaffrey hopes to strengthen Australia-Peru relationships during
his term.
McCaffrey replaced John Woods,
who had occupied the ambassador's
post at the Australian Embassy in
Lima since its rebirth in 2010.
McCaffrey, a DFAT officer with
more than 20 years' experience, replaced Woods late last year in his first
stint as an ambassador.
Prior to his current position, McCaffrey was head of political and economic public affairs at Australia's embassy
in Manila and has spent more than 12
years abroad, in countries such as
Spain, Solomon Islands and Argentina.
"It is true that when a country reopens an embassy it does give the bilateral relationship a kick-along," McCaffrey told Paydirt at the Australian
residence in Lima.
"The commercial, mining and investment-related parts of the relationship have come a long way and there
is much more potential for us, particularly in the mining and energy sectors."
Before arriving at his post in Lima,
McCaffrey travelled around Australia and met
with some of the Australian mining contingent
with interests in Peru.
At the time of print, there were 16 ASX-listed resources companies with projects in the
country.
"I was surprised by the number of companies here but equally surprised by the length
of time they had been here and the feedback
I was getting from the junior miners to Aus-
Australian Ambassador to Peru, Nick McCaffrey, at the Lima embassy. Australia reopened the
embassy in Peru in 2010 after a 24 year hiatus
tralia's leading miners. What I took away from
those meetings were the optimistic views that
these professionals had formed about operating in the destination and the amount of time,
resources and money spent here," McCaffrey
said.
It has been easier for Australians, and many
foreigners in fact, to invest in Peru since former President Alberto Fujimori was deposed
for corruption and human rights abuses in the
Australian Trade Commissioner to Peru Daniel Havas, Latin Resources chief executive and
COALAR chairman Chris Gale with Australian Ambassador to Peru Nick McCaffrey at the
Mining Investment Latin America Conference 2014 in Lima
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early 2000s.
Since Fujimori's demise there has been a
positive change in leadership, and coupled
with mining development, the country's poverty rate has reduced from 40% to about 28%
since the mid-2000s.
President Ollanta Humala's Government
continues to push for social inclusion and
better spread of income as the country's economic growth rate has averaged 5.6% over
the past five years.
Mining has contributed greatly to Peru's
rise with 57% of the country's exports related
to the sector.
Being the world's second-largest producer
of silver and third-largest copper producer
has attracted miners to Peru, however only
a small percentage of the country has tenements granted for mining and exploration (1014%), with fewer than 2% subjected to exploration right now.
Peru has not been immune to the global
resources decline however the Government
remains committed to the industry, according to Australian Trade Commissioner to Peru
Daniel Havas.
"Central Government policies recognise
Peru is a mining country, always has been,
and the country requires mining for stability
and future growth," Havas told Paydirt.
Australian miners and explorers have demonstrated an understanding of the opportunities in Peru and have been followed into the
republic by the METS sector.
"With the slowdown in the sector in Australia, I would say that the METS sector looked at
Latin America more clearly and the slowdown
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February, 2015
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The global resources downturn has meant very little of Peru is currently being explored
ships with services agreements, double tax
and the EU.
has come here later. From a METS perspecagreements and other agreements that make
"We have a good, warm relationship with
tive, the companies that are doing well here
that structure. If you look at the Australia/Peru
Peru, with some parts very strong and other
are those that have or are looking at estabrelationship it has some of those but certainly
parts that need to be worked on very hard in
lishing some sort of headquarters or supply
not many, so we need to work on that."
the next four years, both on the commercial
chain mechanism here on the ground. From
and investment side of things and the diploour perspective there is still a lot of interest
With the Australia-Peru relationship moving
matic side," McCaffrey said.
being shown in Peru," Havas said.
beyond mining, it is the right time for the two
countries to enhance the connection.
"If you map out formal bilateral partnerMore than 60 Australian companies have
"The relationship with Australia is built on
ships, countries A and B have good relationan office in country and while the commercial
mining but the relationship is
presence is strong, Peru's proximstarting to deepen," Havas told
ity to the Pacific Ocean and Andes
ASX-listed companies in Peru
Paydirt
mountains makes it popular with
tourists.
Two years ago Havas' time
COMMODITY
ASX CODE
COMPANY
was largely occupied by the
An estimated 40,000 Australiiron
ore
SRK
Strike
Resources
Ltd
mining sector, however he said
ans visit Peru every year in various
Peru was increasingly looking
capacities - a figure McCaffrey exbase and precious metals
PRA
Promesa Ltd
towards Australia's ideas on
pects to increase.
multi commodities
ICG
Inca Minerals Ltd
education policy and skills de"That number continues to grow
velopment and research.
copper, gold, molybdenum
CGU
Commissioners Gold Ltd
and will continue to. By the end
"Mining is still very important
of my time here I hope we have a
copper, gold
AQD
AusQuest Ltd
but the Peruvians and Australia
relationship with a bit of depth and
gold, silver, base metals
GSC
Global Geoscience Ltd
are looking at other sectors and
balance," McCaffrey said.
other ways of engagement in
Australia and Peru enjoy bicopper, zinc
BHP
BHP Billiton Ltd
the bilateral relationship. We
lateral relations, including an Incopper, gold
RIO
Rio Tinto Ltd
see an interest in agribusiness,
vestment Promotion and Protecinfrastructure, oil and gas. We
tion Agreement (est 1997), while
copper, gold
LRS
Latin Resources Ltd
do quite a lot of work in that
they are part of the APEC group
gold, base metals
WAC
Wild Acre Metals Ltd
space and there is certainly a
negotiating broader Asia-Pacific
copper
growing interest," Havas said.
Metminco Ltd
MNC
economic integration through the
Trans Pacific Partnership Agreecopper
PLP
Platypus Minerals Ltd
- Mark Andrews
ment (TPP).
lead, zinc, silver, gold
RGX
Red Gum Resources Ltd
However, Australia does not
share a free trade agreement as
Peru does with Chile, US, Singapore, China, Korea, Japan, Mexico, Panama, Costa Rica, Canada
MIZ
Laconia Resources Ltd
LCR
gold, silver
Migme Ltd
MIG
gold
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gold, copper
Minera Gold Ltd
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