02/03/2013 11:11 am ET

Peru's Roaring Economy: Latin American Country Enjoying A Virtuous Circle Of Economic Growth

Walk down Calle Gamarra in Lima’s La Victoria district and you might imagine you are in Kowloon. For a dozen blocks, Gamarra and its side streets are packed with multitudes and lined by high-rise buildings, the older ones of rough and ready brick, the newer ones of glass. At ground level every square metre is occupied by shops and galleries selling clothes. The buildings above are an anarchic mixture of offices and workshops.

Gamarra is the humming heart of the rag trade in Peru, a country blessed with top-quality cotton as well as alpaca and vicuña fibre. It is home to more than 15,000 separate businesses. Since at least part of the industry is informal (ie, not legally registered), nobody knows how much Gamarra turns over, but estimates range from $1.3 billion to $3 billion a year. Not long ago La Victoria was known for crime, grime and chaotic poverty. Now Gamarra is pedestrianised and patrolled by municipal police. Nearby, investors are planning an $80m shopping centre combined with new workshop space, according to Carlos Neuhaus, who is advising them.

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