Scores of Peruvian shoppers stepping out of a popular market in a run-down area of Lima clutch bags of Britney Spears CDs, Adidas sweatshirts, Calvin Klein watches and videos of recent block-buster hits. What's the secret in a country where the minimum monthly wage is $117 and 54 percent of Peru's 26 million people live on $1.25 a day or less? It's all fake. While the traffic of pirated goods -- illegally copied videos and software, clothes with false labels, sham toys -- is a worldwide phenomenon, dealers and shoppers in this poor Andean nation say the trade is booming as hard times make originals unaffordable and technology facilitates reproductions.

``Selling originals just doesn't work because of the (economic) situation. One CD costs 63 soles ($18) -- with that much you could feed a family for a week,'' said David, 17, whose tiny stand is packed with pirated CDs that go for about 10 soles ($3) apiece and music videos. The demand for cheaper, pirated goods is even higher in Peru as consumers pare back on full-price luxuries amid a three-year economic downturn. Officials forecast near-zero economic growth for this year.

Authorities say piracy is a plague that robs the revenue-starved government of taxes, inhibits creativity, and often leaves consumer with a defective product. Ugarteche said the government periodically disposes of confiscated goods like CDs and videos by piling it up and running a steamroller over them or by building giant bonfires of seized CDs and videos…