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Recent trends
Peru has made progress in a range of development indicators in the past decades. Between 2005-16, the share of the population living on less than USD 5.5 a day (2011 PPP) was halved. It dropped from 52.2% to 24.3% in line with the 24% average in Latin America and the Caribbean (LAC). At the same time, the share of the vulnerable population living on USD 5.5-13 a day (2011 PPP) increased from 31.9% to 39.6%. The country’s infant mortality rate sharply decreased from 57 to 12 per 1 000 live births between 1990 and 2016.
Peru’s gross domestic product (GDP) per capita increased by almost two-and-a-half times between 1990 and 2017, although labour productivity in terms of GDP per person employed remains only 26.6% of the OECD average. Total factor productivity growth was negative, at -0.5% between 2000-17. Additionally, Peru does not perform well in secure employment and confidence in institutions. The country had the highest share of people in vulnerable employment (49.7% of the employed). Only 34% of the population believe in honesty in elections and 87% think corruption is widespread.
National strategies and international co-operation for development
The “Plan Bicentenario: El Perú hacia el 2021” [Bicentennial Plan: Peru towards 2021] has a strong focus on human rights and their universal validity. The plan is built upon six objectives: fundamental rights and people’s dignity, opportunities and access to services, state and governability, economy, competitiveness and employment, regional development and infrastructure, and natural resources and environment. Special attention is given to Sustainable Development Goal (SDG) 16 (peace, justice and strong institutions) and SDG 8 (decent work and economic growth) (ECLAC, 2018).
The plan supports a macroeconomic policy in favour of public and private investments in activities able to generate quality employment, with decentralisation and respect for the environment as complementary objectives. It proposes incentives for investment in logistic infrastructure at local and regional levels, including hydraulic infrastructure, and irrigation and sewer systems; co-ordination mechanisms between the public and the private sector in order to define strategic areas of development and instruments to improve the competitiveness of the productive sector; reduction of urban informality; and sustainable exploitation of the country’s natural resources.
At the centre of the plan are the upholding of fundamental rights and consolidation of democratic institutions. These include policies such as the reform of the judicial system to ensure transparency in all its processes, as well as the improvement and strengthening of social programmes to reduce poverty. Together with the objective of “State and governability”, it promotes efficiency of the public administration with a focus on restoring the credibility of public institutions.
The second objective of the plan focuses on achievements in universal access to quality public services that Peru aims to guarantee by 2021. These include policies for achieving total coverage of primary education, decentralising health services, ensuring universal availability of drinking water and sanitation, strengthening citizen security, and reducing infant and maternal mortality.
In terms of public financing capacities, Peru’s total tax revenues were 16.1% of GDP in 2016 (vs. 22.7% in LAC and 34.3% in the OECD). The country has implemented mandatory e-invoicing for selected taxpayers since 2014. In 2017, Peru also ratified the Convention on Mutual Administrative Assistance in Tax Matters.
In the last decades, Peru has taken on a dual role of recipient and donor of international co-operation, sharing its expertise in countries of equal or less development through modalities such as South-South Co-operation and Triangular Co-operation. The Peruvian Agency for International Co-operation (APCI in Spanish) is in charge of implementing, programming and organising International Technical Cooperation (ITC) coming from public or private external sources following national development policies. In 2016, Peru’s main bilateral co-operation partners in terms of financial volumes were Germany, the United States, the European Union, Switzerland and Spain. In the same year, the country’s main Triangular Co-operation partners in terms of number of projects were Germany, Spain and the Food and Agriculture Organisation of the United Nations (FAO). Peru’s main South-South Co-operation partners in terms of number of projects were Mexico, Brazil and Argentina.
Among recent international co-operation projects, one stands out: the Programme for the Sustainable Economic Development and Strategic Management of Natural Resources (PRODERN in Spanish) in the regions of Ayacucho, Apurímac, Huancavelica, Junín and Pasco. A bilateral co-operation project supported by Belgium, the initiative aims to reduce poverty while sustainably using the regions’ natural resources and biological diversity. In terms of South-South and Triangular Co-operation, the project between Guatemala, Peru and Germany for the improvement of local tax management in Guatemala between 2012 and 2013 can be singled out.
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https://doi.org/10.1787/g2g9ff18-en
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