Peru has made significant economic and social progress, but further reforms are needed to achieve more inclusive and sustainable growth
8/10/2015 - Economic and social reforms over the past two decades have enabled Peru to significantly improve growth and well-being while raising incomes and reducing poverty. However, further action is now needed to reduce inequality, boost productivity, drive down informality and put the country on a more sustainable development path, according to a new OECD report.
OECD Secretary-General Angel Gurría presented the Multi-Dimensional Country Review of Peru today during a meeting with Peruvian President Ollanta Humala. The Secretary-General and the President also discussed the progress in the implementation of the OECD Country Programme with Peru, launched last December.
“The leadership of President Humala has been crucial in the successful implementation of the Peru Country Programme,” Mr. Gurría said. “The OECD can offer valuable policy advice to Peru as the country confronts new challenges, and I am very encouraged by our growing co-operation in areas ranging from public governance and the environment to the development of this country’s extraordinary human capital. I am delighted to see the high-level of commitment the Peruvian government is devoting to the OECD-Peru relationship, which we expect to continue in 2016 and beyond.”
The OECD Country Programme with Peru was launched in December 2014, bringing together 19 projects the Organisation will undertake with Peru to strengthen its public policies and support its reform agenda. The Programme includes a range of policy reviews, including studies on the effectiveness and integrity of the public sector, improving vocational training, skills uptake and youth employment opportunities, and strengthening environmental policy.
Through the Country Programme, Peru is also expected to participate more actively in several OECD Committees and Working Groups and adhere to a number of OECD legal instruments and initiatives, such as the OECD Declaration on Green Growth. Peru has been a member of the OECD Development Centre since 2009, and has played an active role in promoting knowledge sharing with the Centre’s OECD and non-OECD members, for example in the Policy Dialogue on Global Value Chains for Production Transformation and Development.
The Multi-Dimensional Country Review of Peru recognises the country’s success in raising per-capita income and expanding the middle class, which now encompasses about one-third of the population. It lays out a series of policy recommendations for future reform priorities. These include taking new steps to promote greater economic diversification, improve education, skills and health, address infrastructure and logistics gaps, tackle ineffective labour market regulation and strengthen social protection programmes. Broadening the tax base, increasing the effectiveness of taxation and strengthening institutional frameworks and confidence in the State will be critical to meeting these goals, according to the Review.
“Peru has been one of the most rapidly evolving Latin American economies over the past years, driven by significant reform and solid economic momentum, but it still faces important challenges if it is to consolidate its emerging middle income class and set along the path to inclusive and sustainable development,” Mr Gurría said during a presentation with Pedro Cateriano, President of the Council of Ministers, Ana Maria Sanchez, Minister of Foreign Affairs, and Alonso Segura, Minister of Economy and Finance.
“The Review we are presenting today exemplifies how the OECD is supporting the government as it implements its ambitious reform agenda. Peru has proposed a large number of policies to tackle barriers to development – the OECD can support these by sharing best practices and offering advice for moving forward toward a more inclusive and sustainable economy.”
The OECD Secretary-General’s visit to Lima included participation in the annual meetings of the International Monetary Fund and the World Bank this week, as well as several high-level events including a meeting of G20 Finance Ministers and Central Bank Governors. During his first day in Lima he met with President Humala and various members of his government, as well as representatives of the business sector and civil society.
The Paris-based OECD is an international organisation that promotes policies to improve the economic and social well-being of people worldwide. It provides a forum in which governments can work together to share experiences and seek solutions to the economic, social, and governance challenges they face.
The OECD's 34 current members are: Austria, Australia, Belgium, Canada, Chile, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Iceland, Ireland, Israel, Italy, Japan, Korea, Luxembourg, Mexico, the Netherlands, New Zealand, Norway, Poland, Portugal, Slovak Republic, Slovenia, Spain, Sweden, Switzerland, Turkey, the United Kingdom and the United States.
Four countries – Colombia, Costa Rica, Latvia and Lithuania – have been formally invited to become members of the Organisation, and are currently in the process of accession. The OECD established Country Programmes in 2013 as a new instrument for supporting dynamic, emerging economies in designing their reforms and strengthening public policies. Peru is one of three partner economies - along with Kazakhstan and Morocco - to have been invited in 2014 to undertake a Country Programme.