Diapositiva 1

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INVERTIR INSTITUTE at the Universidad Peruana de
Ciencias Aplicadas (UPC)
Atlas 7th Annual Liberty Forum
Philadelphia, April 25 26, 2007
Daniel Cordova, President of Invertir and Dean of
the School of Economics, UPC
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Content
1. Facts and Opportunities
2. The Peruvian Context
3. The Invertir Institute
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FACTS AND OPPORTUNITIES
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Facts
Aquilino Flores and TOPY TOP Inc.
40 years ago Aquilino Flores was a street car
washer at the central market in Lima.
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Facts

• TODAY Aquilino Flores is one of the most
  important textile businessmen in Peru, leading a
  company that
• Invoices over US 100 million annually,
• Directly employs 5,000 people,
• Exports US 85 millions annually,
• Has 35 department stores in Peru and 3 in
  Venezuela
• Has entered into the financial business through
  the emission of credit cards.

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Facts
The Añaños family and Kola Real
The Añaños Family started their beverage business
during the 1980s, a period of intense terrorist
activity in Ayacucho-Peru. They began
manufacturing soft drinks in their own backyard
and recycling beer bottles to distribute their
product.
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Facts

• 25 years later, Kola Real has become the main
  soft drinks transnational company in Latin
  America.
• Big Cola, their regional trade name, is placed
  after Coca-Cola, Pepsi and Sprite, with over 8
  million consumers.
• 14 plants with a total installed capacity of
  2,000 million liters yearly,
• 8,000 employees,
• estimated annual sales 1 billion dollars.

CASE
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Possibilities
What do the Añaños and Topy Tops stories tell
us?

• Spontaneous entrepreneurial development is
  possible in poor countries like Peru.
• Private entrepreneurship is the source of
  economic growth and poverty reduction.
• We do not need State interventionism to reduce
  poverty. We need more businesses.

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THE PERUVIAN CONTEXT
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A long term view
GDP per capita 1896 2006 (US)
Fuente BCR.
Fuente BCRP.
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A long term view
GDP per capita 1950 2006 (Soles of 1994)
?
?
Fuente BCR.
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A two periods reform
Socialist Reforms (1968-1975)
Market-oriented Reforms (1990-1995)

• Land expropriations
• Nationalization
• Mining
• Fishing
• Public services
• Industry
• Banks
• Monetary disequilibrium
• Expansionist Fiscal System
• Government Direct Credit
• Labor market intervention
• Price control
• Protectionism

• Agriculture (non radical)
• Privatization (Regulation)
• Mining
• Fishing
• Public services
• Industry
• Banks
• Monetary stability
• Fiscal System / Tax reform
• Private pension funds
• Labor market liberalization
• No price control
• Lower Import duties /
• Custom Reform

Respect to Property Rights
Transaction Costs
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Nevertheless

• Anti-market mentality in Lima and the
  countryside is still present in Peru
• The Venezuela- Bolivia-Ecuador threat

Peruvian Electoral Map, 2006
UPP Partido Union por el Peru PAP Partido
Aprista Peruano
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THE INVERTIR INSTITUTE at the Universidad Peruana
de Ciencias Aplicadas (UPC)
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Invertir Philosophy

• Better public policies
• Property rights definition and enforcement

Reduce formal transaction costs
What could we do to enhance the entrepreneurial
engine?

• More entrepreneurs
• Change of mental models
• More information and knowledge

Reduce informal transaction costs
WE HAVE TO STOP THINKING THAT REDUCTION OF
POVERTY IS A MATTER OF STATE ACTION
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Who We Are

• A non-profit organization to promote private
  entrepreneurship in Peru

• Latin America population must recognize that
  market oriented economies, private property
  rights and business development are the best way
  to reduce poverty

• We do not trust State Multilateral
• social programs.

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Invertir Objectives

• To promote research and public policies in order
  to enhance entrepreneurship
• To be a center of business promotion through
  business incubators and angel investor networks.
• To develop training programs for young
  entrepreneurs and small and medium enterprises
  (SME).

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Research and dissemination

• Entrepreneurship and Social Services
• Private Education for Low Income Households
  (Villa El Salvador Case)
• Entrepreneurship and Free Trade Agreements
• ATPDEAs Regional Impact in Ica.
• Entrepreneurship against poverty promoting
  Democracy and Development from a private sector
  perspective.

?
Projects in process
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Training programs for SME
FINANCIAL MANAGEMENT
MARKETING MANAGEMENT
Finance
Accountancy
Marketing
Price Strategy
Entrepreneurial Accounting
Entrepreneurial Finance
Customer Services
Market segmentation

• Applied
• Training on
• Management

Credits Management
Funds Management
Consumer Behavior
Corporate Identity
ADMINISTRATIVE MANAGEMENT
LAW AND ECONOMICS
Managerial Skills
Strategic Planning
Basic economics
Microeconomics
Administration Organization
Business Plan
Corporate Law
Property rights
Inventory Management
Human Resources Management
Taxes Management
Regulation and Management
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Training programs for young students from the
countryside

• Leadership
• Entrepreneurship
• Law Economics

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Conferences

Next September 27 28, Lima
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Invertir Activities
Business Incubators
Angel Investor Networks
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Some current sponsors
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INVERTIR INSTITUTE at the Universidad Peruana de
Ciencias Aplicadas (UPC)
Atlas 7th Annual Liberty Forum
Philadelphia, April 25 26, 2007
Daniel Cordova, President of Invertir and Dean of
the School of Economics, UPC