February 6, 2012

The change of the country image and the National brand - The case of Peru

The change of the country image and the National brand - The case of Peru
(Essay for my course of Public Diplomacy)
by @fonchobaggins

Even when there is no record or recognition that Frank Sinatra came to Peru, he didn’t have any problem on singing, back in 1957: “Come fly with me, let’s float down to Peru. In llama-land there’s a one man band and he’ll toot his flute for you”

Because of the theme of the song we know the invitation is under a romantic and exotic background and thus we can picture such labels to the country for the foreigners. On the other hand, 12 years later, there is a phrase on the Peruvian literature that will have a huge impact and will become part of the daily speech: “When did Peru got screwed?” In the book where this phrase is originally taken, Conversation in the Cathedral (written by 2010 Literature Nobel Prize winner Mario Vargas Llosa), Santiago Zavala wonders why there is no sign for hope as the development, growth and freedom seem to be stagnant: “Peru screwed, he thinks, Charlie screwed, everyone screwed. He thinks: there is no solution”. The book illustrated the Peru during the 50s, that same country where Sinatra wants to take his lover is, in fact, full of corruption, immorality, social issues and gaps under the control of the military power, with General Odria as the dictator in charge. This phrase written by Vargas Llosa is powerful and full of meaning for the Peruvian population, because Santiago Zavala was not just a solitary student walking through the downtown but a picture of every Peruvian at that time.

Today, Peru is a country with more than 28 million inhabitants and 1 million of square meters in territory, its GDP per capita (estimated by the International Monetary Fund for 2011) is USD 5 593 and the United Nations Development Programme (UNDP) catalogues it as a “high human development” country in the 2011 Human Development Report. Known for its gastronomy and the archeological complexes that the Empire of the Tahuantinsuyo (commonly known as the “Inka Empire”) and many other pre-colonial cultures left, Peru was seen as an exotic touristic destination for many years but not as a business partner. Nevertheless, after dealing with big problems of inflation and terrorism at the beginning of the decade of the 1990, Peru found the way to be seen as an interesting location for business since the borders opened to the market under the IMF formula to fight against inflation.

Logo of the Peru nation-brand (Marca Perú)

It is not worthy to discuss about the cultural and historical heritage the country has to enjoy itself and to offer to the world (ranked number 4 on the category “Heritage and culture” of the Future Brand’s Country Brand Index). Just to describe roughly in a couple of lines, we can see the introduction that the BBC uses on its website (by December 2011) for Peru’s natural and cultural heritage:

“Peru's rich and varied heritage includes the ancient Incan capital of Cuzco and the lost city of Machu Picchu. The country boasts spectacular scenery, including Lake Titicaca, the world's highest navigable lake. A growing number of visitors are being drawn to its variety of attractions, such as its archaelogical treasures, the Andes mountain range and the Amazon rainforest, which makes up about half the country”.

By the beginning of May 2011 there was a big surprise for the interconnected Peruvians: the birth of the brand “Perú” along the internet, in a video that caught popularity quickly due to its creativity, professionalism and the bridge that build between the traditions and the feelings. There we can see recognized cheffs, actors, sportsmen, singers and other culture icons in a trip to Nebraska-USA, where they get into a small village with no more than 60 thousand inhabitants to deliver the experience of being a Peruvian. This is a video made in regards of tourism, with a cost of USD 350 000 although the whole branding campaign costed more than a million USD. Note that the logo of the campaign was shown on the New York Stock Exchange in March, just after days of the release of the video in Peru and, on the most important festival of the Spanish-speaking world, the campaign won the prize with the same name: “Ojo de Iberoamérica” (The Ibero America Eye). Although the cultural manifestations caught in the video do not enclose the whole cultural offer Peru has for the tourists, it still holds the most representative expressions of culture that people may seems to be interested on getting to know; and the campaign has a broader panorama than just tourism, entitled as “(…) a Brand that unifies the efforts in terms of tourism, investment and exports".

Documentary: Marca Perú (Peru country-brand), with english subtitles [15 min, aprox]

As per the words of Martin Perez, Minister of International Commerce and Tourism. These are exactly the 3 base elements of the whole campaign, and no similar effort to manage the name of the country as a brand was made before, although the Peruvian Tourism Commission has been working for more than 30 years. In another interview for the local newspaper ‘El Comercio’ Mr. Perez mentions:

“Before, even when we didn’t have a national Brand, we managed to duplicate the amount of our exports up to USD 35 thousand million, today that our exporters have a solid marketing tool that will allow them to take a quality stamp, I am sure that there are conditions to increase substantially our deliveries. We have to conceive the Peru-brand as a supplementary element of the government’s promoter task and the constant effort for innovation and quality of the private sector”.

Data of both graphics hold data in regards of Peru
Source: World Bank

If during the 70s and 80s the financial crisis due to the external debt was a huge problem for developing countries, now Peru is looking attractive to business further than only tourism, and there is the need to underline the differences with other countries in the region and show the relative advantages of investing and visiting Peru. As it’s pointed on the national website of the Peru’s National Brand:

“The country is currently in a renovation, sustainable-economic growth and consolidation process in the world map. We have achieved improvements on the participation of new sectors in industry, increased the public expenditure, investment on civil and touristic infrastructure, so as achieving stability in politics and economics. (…) This is the best moment to tell the world we are having a good time in the country, and that is a competitive advantage”.

As per the website Nation Branding indicates, there is the need of certain framework that will allow the national brand to have a positive impact on the world. We can mention: transportation, energy, water availability, communications, education, health, and a market-based economy market as long as people with skills or talent; as such elements. Therefore, it would have been a failure to deploy these efforts on the national branding during the 90s or earlier because of the economic instability. Today a whole new picture is in front of the Peruvians, although there are still social gaps that need to be fulfilled in order to reduce the huge differences between the very developed and globalized Lima and the unplugged population in the rest of “the provinces”, which is a pending assignment for the current and future governments. But the situation has changed, and now 55% of the Peruvians feel “pride” when asked what feeling they have for their country, according to a survey held by the most important company in statistics in Peru: IPSOS Apoyo, which results were published on the newspaper ‘El Comercio’ on July 31st 2011.

Source: El Comercio, 31st July 2011
Link (Printed edition) // Link (Only text)

Beyond the economic growth and the benefits it brings to the society, lately Peru got more sport and cultural success than usual, considering (just to mention a couple) two Surf World Champions, a World Chess Youth Champion and a Nobel Prize in Literature. Then, nobody asks “When did Peru got screwed?” anymore, instead people are looking forward to locate a business opportunity or at least invest on the Stock Exchange (which had record results in 2007), if not complaining to be considered inside the growth model. Nowadays Peruvians are not feeling anymore this sensation of stagnation but recognize themselves as part of a rich heritage, starting by the food. This is also fed by a master parallel campaign led by Gaston Acurio, a national Cheff who boasted the credibility, variety and quality of the Peruvian food both in the internal market and around the world. Food is now a recognized element of the Peruvian identity, and we can appreciate its impact on the Peru-brand video, where the Peruvian ambassadors who arrive to Nebraska say, in Spanish and to start with the whole idea to the local Peruvians: “You are from Peru; you have the right to try delicious food!” But gastronomy is just one element of the identity, recognizing the Peru-brand and the national symbols is also an important process, as Aldo Panfichi, Pdh on Sociology by The New School for Social Research (USA) and Head of the Social Sciences Department in the Catholic University of Peru (PUCP) explains:

“(…) the patriotic feeling is becoming stronger, overtaking the political or cultural disputes. Everybody claim to be Peruvians, from the bottom to the top, and that is a difference over what we’ve been historically saying about Peru: that we were a country with lack of identity, con a weakness on the attachment to the national symbols. This was true until 10 or 15 years ago (…)”

Furthermore, the swiss Institute for Management Development (IMD), on its 2008 Competitiveness Ranking shows Peru as the 2nd best country in Southamerica to do business, right after Chile; and also the 2nd rank on Economic Environment and in Risk. Chile is not only the country with the highest Humand Development Index in the region (as per 2011 the Human Development Report issued by the UNDP), but the country with the largest experience on the usage of a national-brand. As per it’s indicated on the USA Department of State (by December 2011),

“Peru's economy is well managed, and better tax collection has been increasing revenues, with expenditures keeping pace. Private investment is rising and becoming more broad-based. Peru obtained investment grade status in 2008. In view of his appointment of a respected economic team and actions taken during his first 100 days in office, many anticipate that President Ollanta Humala will continue the sound economic policies of several prior administrations. While seeking to continue the well-functioning economic engine inherited from its predecessors, the Humala administration is pursuing a social inclusion agenda with the goal of ensuring that the lower classes increasingly benefit from Peru’s economic success”.

Let’s hope for the best future and a responsible management of the Peru-brand.