Peru is moving to extend its agro‑export growth by pairing a sweeping tax incentive with a large irrigation buildout. Congress has approved a measure that reduces corporate income tax for large agricultural exporters from 29.5 percent to 15 percent for a ten year period, while medium sized firms pay 1.5 percent and small producers are exempt. “This will allow us to attract investment,” said Agriculture Minister Ángel Manero.
The law was published on September 10, 2025 in the official gazette, cementing a legislative push that reframes the sector’s economics ahead of the 2026 tax year. With fruit exports leading the basket, the government is betting that fiscal relief will unlock a fresh round of capital to scale farms, packhouses, and cold chain capacity.
Tax Incentives Reframe Sector Economics
The incentives arrive alongside a state backed project pipeline designed to expand irrigated land and reduce hydrological risk across coastal and Andean basins. In March, the government unveiled 22 irrigation schemes worth about 24 billion dollars that aim to add one million hectares, with approximately 85 percent of awards to be procured as public private partnerships. Delivery will be staged between 2025 and mid 2026, and authorities say eight projects totalling 11 billion dollars are already in motion.
The portfolio mixes long discussed mega works with regional systems, including the Trasvase Marañón, Chinecas, and Pampas Verdes water transfers, where sponsors will need to structure water storage, conveyance, and land development phases to reach bankability. If procurement stays on timetable, contract packaging and risk allocation will determine whether local pension funds and multilaterals crowd in alongside international operators.
PPP Delivery Targets One Million Hectares
For investors, the new tax law and the PPP pipeline are complementary levers. Lower effective tax rates improve post tax returns on upstream planting and downstream processing, while accelerated depreciation on hydraulic works embedded in the statute reduces payback periods for shared assets such as canals and reservoirs.
Policy risk remains in view, since repeal initiatives were tabled in Congress in September, and the executive must still issue detailed regulations that will shape eligibility tests, stability contracts, and labour provisions.
Even so, officials are positioning agriculture as a macro driver. “Our goal is to reach 40 billion dollars in exports by 2040,” Manero said, framing a shift in which farming could overtake mining in export value by mid century if land, water, and market access plans hold.
Export Mix Shifts Beyond Mining
Execution now hinges on procurement discipline and water governance. Sponsor appetite will track clarity on tariff structures, rights to develop new parcels, and environmental and social impact management along sensitive corridors. The state’s intention to concentrate awards through PPPs signals reliance on milestone payments and availability style frameworks, although hybrid models that blend land sales, offtake pre commitments, and credit lines from development banks may emerge on project by project bases.
If the law’s incentives and the PPP programme align, Peru’s agro‑export platform could deepen its footprint well beyond blueberries and grapes.