In 2012, the economic and commercial relations between Peru and the EU took a great step forward with the signing of a Trade Agreement.

The agreement entered into force on the 1^st of March 2013 and has contributed over the years to the deepening of the economic relation between the two trading partners, benefiting not only the exporting industries on both sides, namely through the removal of tariffs, but also the development of the internal market through stability and economic diversification.

The Trade Agreement includes significant tariff concessions for agricultural products and liberalises trade in industrial and fishing products. This has allowed for the growth in Peru’s non-traditional exports, in particular from the vigorous agricultural sector, thus contributing to the diversification of Peru’s economy towards sectors with higher added value.

The Trade Agreement has also contributed to the effective and reciprocal opening of the parties' public procurement markets, the protection of intellectual property rights, the promotion of free competition, and the liberalization of current payments and capital movements related to investment, thus leading to a climate conducive to a growing flow of foreign direct investments. 

Trade relations are now guided by internationally agreed best practices, while ensuring a transparent, non-discriminatory and predictable environment for operators and investors through mechanisms to address non-tariff barriers, a chapter on trade and sustainable development contemplating sustainability both from an environmental as well as a social/labour perspective, and an advanced bilateral dispute settlement mechanism. 

Finally, the Trade Agreement also contemplates cooperation to promote competitiveness and innovation, to modernize production, and to facilitate trade and technology transfer between the partners.

In summary, the Trade Agreement between Peru and the EU has improved the already thriving trade and economic relations, as shown by the following sample of indicators: 

• The EU is the 3rd largest trading partner for Peru and accounts for 11% of its total trade in goods. 
• The commercial exchange between Peru and the EU amounted to €10 billion in 2021. 
• Peru is the 49th largest trading partner for the EU and accounts for 0.2% of the EU’s total trade in goods.
• In 2021 Peru exported to the EU €6.5 billion (0.3% of total EU imports). 34% were vegetable products (mainly fruits 23%, coffee 5% and vegetables 3%), 31% ores, and 6% natural gas. 
• In 2021 Peru imported from the EU €3.5 billion (0.2% of EU total exports). 38% were machinery, 17% were chemical and pharmaceutical products and medical devices and 5% vehicles. 
• The EU is the first foreign investor in Peru. EU FDI stocks in Peru increased from €12.9 billion in 2015 to €14.9 billion in 2020 (+15%).

The European Union and Peru are long-standing allies. They share common values such like democracy, human rights and multilateralism, and common interests such as the promotion of sustainable and inclusive growth or action against organized crime.

Cooperation priorities are set out in indicative multi-year programmes.

The bilateral Multiannual Indicative Programme Peru 2021-2027 sets aside €57 million, non-reimbursable, for the period until 2024, and an amount for 2025-2027 still to be confirmed. Priorities include:

1. Circular transition: Promote the transition to a green and inclusive economy and development, in particular:

• Transition to a Circular Economy, production and consumption patterns and value chains at territorial level.
• Work towards Sustainable Cities and territorial economic development.

2. Human development and social inclusion: reduce inequalities, for more inclusive and prosperous societies.

• Promote universal Social Protection, access to social services for all, including the most vulnerable.
• Support Peru in Migration management and the inclusion of migrants.

3. Governance and rule of law: Consolidate the rule of law and democracy, promote human rights and strengthen institutional capacities.

• Strengthen Good governance and democracy and improve effectiveness, accountability and inclusivity of institutions.
• Tackle Organized crime, drug and human trafficking and environmental crime such as illegal mining and logging.

In addition to bilateral programmes, there are other cooperation opportunities, i.a.:

• The regional Programme for the Americas and the Caribbean 2021-2027 , focusing on Green Transition, Digital Transformation, Sustainable and Inclusive Economic Recovery, Democratic Governance, Security, Migration and Social Cohesion. Relevant programmes include EUROsociAL+ for social cohesion; EUROCLIMA+ for climate cooperation; COPOLAD, for dialogue on drug policies; EL PAcCTO on citizen security; and EUROFRONT on border management.
• Erasmus fosters cooperation between higher education institutions and the mobility of teachers and students, and has provided numerous scholarships to Peruvians;
• EU support to Civil society Organizations strengthens CSOs as independent actors of good governance and development.
• The EU programme for Human Rights and Democracy, epromotes and protects human rights and fundamental freedoms, democracy and the rule of law worldwide.
• EU-ECHO, who not only provides Humanitarian aid in emergencies, but also disaster preparedness assistance.
• Global programmes such as Horizon Europe, the EU research & innovation framework programme, open to international partners.