Is the New Peru Better for Expats?

article from October 20, 2011

By Jamie Douglas

So maybe 2010 Nobel Prize winner for literature, Peruvian writer Mario Vargas Llosa was being overly dramatic when, earlier this year, he reluctantly endorsed Ollanta Humala in the runoff for the presidency of the Andean Nation. Humala was running against Keiko Fujimori, the daughter of the disgraced former President Alberto Fujimori, now deservedly rotting away in prison. The highly respected Vargas Llosa summed the runoff up as the Peruvian people having the choice between AIDS and terminal cancer.

The Lima Stock Exchange must have felt that one of those unenviable descriptions fit Ollanta Humala, as it experienced its largest drop ever upon his win. Unfounded fears of Chávez-style socialism had been spread by the opposition, to the point where they apparently started believing their own propaganda.

During the campaign, I received several communications from US and British expats living in Peru, all of them telling me that it was over in the event that Marxist/socialist Humala would win, and they would leave the country. I would love to hear from them, to see what their view is now!

Humala surprised his opponents when he appointed many moderate technocrats with many years of experience to his cabinet, and the stock exchange quickly recovered. The mining companies, which provide a nice chunk of income for the state, agreed to a reasonable upward adjustment in royalties, and a portion of that is to go toward helping the very poor who live in the remote areas of Amazonia and in the Andean highlands – we hope!

So suddenly, Peru is back on the radar for expats. Lima always had a sizeable expat community, and lately there have been a number of new arrivals, many of them professionals working for multinationals. For expats who require some safety and comfort in their lives, Lima is not inexpensive. One-bedroom apartments in the center will run you from US$400 to $800 per month. Food prices can vary wildly, depending on where you buy. Fresh fruits and vegetables at the market are the most economical and healthiest, while supermarkets tend to be much pricier.

If you are looking at Arequipa or Cusco, your cost of living will be lower. The rents in Arequipa are substantially lower, with a three-bedroom apartment in the city center averaging just over $400 per month.

Health care is actually something that brings some retirees to the area, as the cost is very reasonable, and there are a number of doctors and clinics that specialize in eldercare. I see that as a growing specialty field, as more and more Baby Boomers find themselves priced out of the US market or are tired of the mediocre care afforded through Medicare, which is only good in the USA. Dentists are also very reasonable and good. Just make sure that, in either field, you have a reputable professional taking care of you.

For those of you with school-aged children, there are a number of choices available. If you want that your kids to become fluent in Spanish so they can help you with shopping, the bureaucrats and the mechanic, send them to a good Spanish-speaking private school. There are a number of them. It would probably be a good idea to find a good school before you rent or buy a home, as the daily to-and-from can be a grind in Lima’s traffic nightmare.

As far as your utilities are concerned, it depends mostly how big your refrigerator is – and how efficient it is. Expect to have to pay between $150-200 for everything, including water, gas, electricity (220 V, 60 Hz), broadband Internet (6 GB flat rate) and telephone. For making international calls, use Skype, which is free between Skype users, or do as I do and get a low-cost subscription with a US number that your friends and loved ones can reach you on at no cost to you.

If you need domestic help, it is also available for $200 and up per month. Inform yourself of the labor laws. Knowledge of them is protection, for if you have reason to dismiss you helper after paying them under the table, they might just turn you in.

Would I recommend Peru? Hell yes! It is a very fascinating country that is full of surprises – and not just Machu Picchu. Just south of Lima, there are intensive archeological excavations under way. A quick flight over the Andes will take you to Iquitos in the Amazonian rainforest, where you will have a chance to explore and see incomparable fauna and flora, as well as visit with the indigenous inhabitants.

Jamie Douglas

San Rafael, Mendoza

Where fortunately, the pisco sour is NOT the national drink!

[Image of Arequipa Yanahuara, Peru, via Wikipedia]

I encourage you to write me at cruzansailor [at] gmail [dot] com with any questions or suggestions you may have. Disclaimer: I am not in any travel-related business. My advice is based on my own experiences and is free of charge (Donations welcome). It is always my pleasure to act as a beneficial counselor to those who are seekers of the next adventure.