OECD Development Pathways Multi-dimensional Review of Peru Volume 2. In-depth Analysis and Recommendations (eBook)

Oecd (Autor)

eBook Download: EPUB

2016 | 1. Auflage
156 Seiten
OECD Publishing (Verlag)
978-92-64-26536-3 (ISBN)

Infos

Peru has experienced significant improvements in economic growth, well-being and poverty reduction since the introduction of macroeconomic reforms, economic openness and more effective social programmes in the 1990s. However, the country still faces structural challenges to escape the middle-income trap and consolidate its emerging middle class. This report provides policy actions to tackle the main bottlenecks to boost inclusive development and well-being in Peru. In particular this report presents an in-depth analysis and policy recommendations to boost economic diversification and productivity, improve connectivity and reduce informality. Policy actions in these areas demand better institutions and improvements in areas and markets, including research and development and innovation, fiscal policy, education and skills, logistics and transport infrastructure as well as labour and product markets.

Inhalt

Foreword?????????????????????????????? 5
Acknowledgements?????????????????????????????????????????????? 6
Table of contents???????????????????????????????????????????????? 9
Acronyms and abbreviations?????????????????????????????????????????????????????????????????? 13
Executive summary???????????????????????????????????????????????? 17
Promoting economic diversification and productivity???????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 17
Improving transport connectivity?????????????????????????????????????????????????????????????????????????????? 18
Tackling informal employment?????????????????????????????????????????????????????????????????????? 18
Chapter 1 Overview: Charting Peru’s way to a high-income economy with better well-being for all citizens?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 21
Charting inclusive development in a changing global landscape???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 23
Charting the way forward: The value of a multi-dimensional approach???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 23
Box 1.1. MDCR in the context of the OECD Country Programme with Peru?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 24
Figure 1.1. Peru and Latin American population distribution by per capita income level (% of population), 2004-14???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 25
Promoting economic diversification and productivity???????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 26
Figure 1.2. Moving from middle-income to high-income in Peru and selected benchmark economies???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 27
Improving transport connectivity to foster competitiveness and inclusiveness?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 28
Tackling informal employment and informal economic activities???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 28
Anticipating global trends: Three scenarios to test recommendations???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 29
Scenario 1: A new commodity super cycle???????????????????????????????????????????????????????????????????????????????????????????? 30
Scenario 2: Increasing technology and mechanisation???????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 31
Scenario 3: Rising expectations of the middle class???????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 31
Notes???????????????????????? 32
References?????????????????????????????????? 32
Chapter 2 Towards higher economic diversification and productivity in Peru?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 35
Peru needs to boost productivity growth and increase economic diversification???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 36
Productivity growth has been slow and heterogeneous across sectors and regions?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 37
Figure 2.1. Labour productivity gap in Peru and selected benchmark countries (% of OECD average), 1980-2016???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 37
Figure 2.2. Labour productivity growth (%) by economic sector in Peru, 2002-12?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 39
Figure 2.3. Labour productivity growth (%) by region in Peru, 2002-12???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 39
Towards higher economic diversification???????????????????????????????????????????????????????????????????????????????????????????? 40
Figure 2.4. Projections for Peruvian and other Latin American exports to China, 2010-30???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 41
Opportunities to increase productivity and economic diversification???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 41
Identifying promising exports???????????????????????????????????????????????????????????????????????? 41
Figure 2.5. Top 35 most likely Peruvian exports by level of processing and RCA index, 2014?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 43
Figure 2.6. Average value-added and labour intensity per worker for manufacturing sectors in Peru???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 44
Products beyond commodities with lessons for greater diversification?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 45
Figure 2.7. Export diversification in Peru?????????????????????????????????????????????????????????????????????????????????????????????????? 45
Figure 2.8. The development of agro-products in Peru?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 46
Recent initiatives supporting start-ups and entrepreneurship?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 50
Policy actions to increase productivity and economic diversification in Peru?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 51
Supporting innovation and SMEs?????????????????????????????????????????????????????????????????????????? 51
Figure 2.9. Patent applications per million people in selected countries, 2013?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 51
Figure 2.10. Survival rates of export firms in Peru, 2003-15 (%)?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 52
Tackling barriers to entrepreneurship???????????????????????????????????????????????????????????????????????????????????????? 53
Figure 2.11. Barriers to entrepreneurship index in selected countries, 2013???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 54
Increasing regional integration???????????????????????????????????????????????????????????????????????????? 54
Towards better management of commodity resources at the sub-national level?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 55
Figure 2.12. Mismatch between regional commodity transfers (2014 data) and basic needs transfers (2013 data) per capita in Peru (in PEN)?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 57
Towards greater fiscal resources with fair and efficient taxation???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 58
Figure 2.13. Tax revenues (% of GDP) in selected countries, 2014?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 58
Creating better planning and implementation frameworks to boost economic diversification and productivity???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 59
Towards the design and implementation of a development strategy???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 59
Figure 2.14. Strategic and development plans in Peru at different levels of government?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 61
Towards greater capacity and co-ordination in the design and implementation of the development agenda at the sub-national level???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 62
Conclusions and policy recommendations?????????????????????????????????????????????????????????????????????????????????????????? 63
Box 2.1. Main policy recommendations to increase economic diversification and productivity in Peru?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 64
Annex 2.A1 Methodology to identify new potential sectors in Peru?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 67
Measuring the probability to export selected products based on benchmark country exports?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 68
Annex 2.A2 Overview of main national plans and agendas to boost economic diversification and productivity???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 69
Notes???????????????????????? 71
References?????????????????????????????????? 72
Chapter 3 Improving transport connectivity in Peru?????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 77
Enhancing connectivity beyond transport infrastructure to increase competitiveness and inclusiveness in Peru?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 78
Connectivity: going beyond transport infrastructure???????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 79
Recent performance in transport outcomes in Peru?????????????????????????????????????????????????????????????????????????????????????????????????????????????? 80
Figure 3.1. Logistics performance gap to the best-performing OECD country, 2016???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 81
Figure 3.2. Ratio of freight costs to tariffs, 2012-15?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 82
Creating a national transport strategy aligned with the development agenda?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 82
Effective cost-benefit analysis embedded in a wider framework for assessment and prioritisation???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 84
Box 3.1. Cost-benefit analysis: French appraisal system and United Kingdom project valuation framework?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 85
The framework for private-sector involvement is improving???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 85
Figure 3.3. Initial and renegotiated costs of concession contracts in Chile, Colombia and Peru (1993-2010)?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 86
Towards the creation of a logistics observatory in Peru???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 86
Developing a national policy for urban and metropolitan transport???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 87
Figure 3.4. Influence of car-oriented vs. public transport-oriented transport policies on car and motorcycle ownership in Peruvian cities, 2010-50?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 88
Figure 3.5. Influence of car-oriented vs. public transport-oriented transport policies on CO2 emissions in Peruvian cities, 2010-50???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 89
Developing objectives, targets and guidelines for urban mobility?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 90
Towards a solid framework for urban mobility master plans???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 91
Box 3.2. Developing successful mobility master plans?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 92
Advancing programmes to enhance the local financial capacity of cities?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 92
Improving transport connectivity in the Lima-Callao metropolitan area???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 94
Figure 3.6. Transport in Lima-Callao?????????????????????????????????????????????????????????????????????????????????????? 95
Figure 3.7. Share of transport modes by level of household income???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 97
Box 3.3. Principal governmental stakeholders involved in planning, management and investment for transport in Lima and Callao???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 98
Figure 3.8. Average days per container ship turnaround in 2014?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 100
Towards a mobility authority for Lima-Callao?????????????????????????????????????????????????????????????????????????????????????????????????????? 101
Creating essential conditions for the success of the mobility authority for Lima-Callao???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 102
Table 3.1. International experiences for achieving a successful mobility authority in Lima-Callao???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 102
Developing a strategy to realise port city benefits???????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 103
Box 3.4. Truck appointment systems at US ports?????????????????????????????????????????????????????????????????????????????????????????????????????????? 104
Conclusions and policy recommendations?????????????????????????????????????????????????????????????????????????????????????????? 106
Box 3.5. Main policy recommendations to improve connectivity in Peru?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 106
Annex 3.A1 International metropolitan transport authority frameworks, staff and budget?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 110
Overview of international metropolitan authorities?????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 110
TfL – United Kingdom 110
STIF – France 110
LTA – Singapore 111
URBS – Brazil 111
Staff and budget of selected metropolitan transport authorities???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 111
Staff size?????????????????????????????????? 111
Budget?????????????????????????? 111
Annex 3.A2 Economic benefits of ports to port cities?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 113
Table 3.A2.1. Estimated value added by cargo type (USD/t)???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 113
Table 3.A2.2. Estimated port-related multipliers in selected port cities?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 113
Notes???????????????????????? 115
References?????????????????????????????????? 115
Chapter 4 Towards more formal jobs and economic activities in Peru?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 121
Informality is a long-standing, multi-faceted barrier to inclusive development in Peru?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 122
Informality is a complex phenomenon with multiple causes and consequences???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 122
Box 4.1. Defining and measuring informality in Peru???????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 123
Informality is a widespread, long-standing phenomenon in Peru???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 124
Figure 4.1. Informal employment in Peru???????????????????????????????????????????????????????????????????????????????????????????? 125
Figure 4.2. Employment status across income groups for young people aged 15 to 29 in Peru, 2014???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 125
Informality has many faces in Peru?????????????????????????????????????????????????????????????????????????????????? 126
Table 4.1. Categories of informality according to different cost-benefit scenarios in Peru, 2013?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 127
Figure 4.3. Informal employment by group as a share of the total informal labour force in Peru, 2014?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 127
Box 4.2. An alternative approach to categorising informal workers by different socioeconomic characteristics?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 128
Figure 4.4. Latent class analysis of informal workers in Peru, 2014???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 128
Informality is largely explained by weaknesses in the institutional framework???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 129
Tax regimes for SMEs can be improved to provide incentives to become formal and grow?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 129
Table 4.2. Tax regimes for individuals or firms with businesses in Peru, 2016???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 130
Labour costs of formalisation represent a barrier to formality for low-income groups in Peru?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 131
Box 4.3. Taxing wages: Estimating labour costs and tax burdens in Latin America and the Caribbean???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 131
Table 4.3. Implied formalisation costs to formal and informal salaried workers in selected countries, 2013 (employee plus employer contributions to old-age and health insurance programmes as % of wage earnings)?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 132
Figure 4.5. Informality and formalisation costs in Peru, 2014-16?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 133
Figure 4.6. Tax liability by tax regime in Peru, 2016???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 134
Informality as a result and hurdle in a low-productivity, primary-based economy???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 135
Low labour productivity is a strong barrier to formal employment?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 135
Figure 4.7. Labour income of formal and informal workers and its distribution relative to the minimum wage in Peru (in PEN), 2014???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 136
Figure 4.8. Total labour costs by geographic location in Peru, 2014???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 137
Figure 4.9. The circular relationship between skills, productivity and informality?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 138
Figure 4.10. Informal and formal employment by level of education in Peru, 2014???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 138
The primary structure of Peru’s economy is not conducive to formal job creation???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 139
Figure 4.11. Labour productivity in Peru’s economic sectors, 2013???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 140
Figure 4.12. Employment composition by sector and geographical location in Peru, 2014 ?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 141
Informality leads to lower-quality jobs and limits the reach of social protection???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 142
Informality is linked to poor working conditions and underemployment?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 142
Figure 4.13. Earning equality by formality in Peru?????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 143
Figure 4.14. Working time by formality in Peru, 2014?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 144
Figure 4.15. Hours worked at primary occupation by formality and income quintile Peru, 2014???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 144
Figure 4.16. Incidence of very long working hours in Peru, 2014???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 145
Informality limits the reach of social protection???????????????????????????????????????????????????????????????????????????????????????????????????????????????? 146
Figure 4.17. Health insurance coverage in selected countries?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 146
Figure 4.18. Health insurance coverage rates by income per capita quintiles in Peru, 2014???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 147
Figure 4.19. Health insurance coverage rates by formality and income per capita quintiles in Peru, 2014???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 147
Table 4.4. Fragmentation in the health insurance system in Peru as of December, 2015?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 149
Conclusions and policy recommendations?????????????????????????????????????????????????????????????????????????????????????????? 152
Box 4.4. Main policy recommendations to promote formal economic activities and employment and mitigate the impacts of informality in Peru???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 153
Notes???????????????????????? 155
References?????????????????????????????????? 155

Textauszug

Chapter 2. Towards higher economic diversification and productivity in Peru

This chapter analyses and provides recommendations to boost economic diversification and productivity in Peru. An analysis of Peru’s recent performance in productivity and economic diversification indicates a marked need to boost both in order to achieve a more inclusive development. Several opportunities emerge based on potential new products to export and recent experiences in both successful economic diversification and the promotion of start-ups and entrepreneurship. The chapter identifies policy focuses needed to seize these opportunities, including further innovation; small and medium-sized enterprise (SME) sustainability and reduced barriers to entrepreneurship; and increased regional integration. Better management of commodity-based revenues at the sub-national level and improvements in the taxation system are also relevant to Peru’s development goals. The chapter concludes with recommendations for the institutional framework to improve the design and implementation of Peru’s strategic development agenda.

Further economic diversification and productivity is needed in Peru to overcome the so-called middle-income trap (MIT) and increase well-being for all Peruvians. Gains in productivity have been slow in the past decade, and further economic diversification would increase formal job creation and reduce dependence on external demand for commodities.

Based on recent experiences and potential new sectors, recommendations and policy actions to increase economic diversification and productivity in Peru are indicated. Key among them is the need to enhance the institutional framework to promote better prioritisation and implementation of policies for greater competitiveness.

This chapter analyses economic diversification and productivity in five sections. First, the chapter analyses the recent performance in labour productivity and total factor productivity, and the external sector composition in Peru. Second, it identifies new activities contributing to further economic diversification based on international experiences. Given the recent growth in non-traditional exports in sectors such as agro-industry, tourism, metal-mechanics and forestry, the chapter also presents the pre-conditions and successful paths for further diversification in Peru. It also analyses recent programmes and initiatives implemented to enhance start-ups and entrepreneurship. Third, the chapter presents policy actions to increase productivity and economic diversification through several channels, including 1) boosting entrepreneurship, SMEs and innovation; 2) increasing regional integration; 3) improving management of commodity-related revenues; and 4) increasing fiscal revenues and implementing a better taxation structure to promote equity and entrepreneurship in Peru. Fourth, the chapter focuses on and provides recommendations for the institutional framework to improve the design and implementation of a strategic plan in Peru at both the national and sub-national level. The chapter concludes with the resulting main policy recommendations.

Peru needs to boost productivity growth and increase economic diversification

Peru’s recent period of high and sustainable growth in gross domestic product (GDP) per capita helped it to achieve upper middle-income status in 2008, but this success is not without the challenges of a MIT economy. Sound macroeconomic performance in the past decade has been favourable to high and sustainable economic growth and has been underpinned by better macroeconomic management and an exceptionally favourable external environment.

However, despite this impressive surge in GDP per capita performance, Peru has not been able to close the gap with other emerging markets, and formal job creation remains sparse. Boosting productivity and economic diversification are fundamental to overcoming the MIT and providing better jobs in Peru.

Productivity growth has been slow and heterogeneous across sectors and regions

Escaping the MIT will require increases in productivity and greater diversification of the economy. Like Brazil, the People’s Republic of China (China) and Korea, Peru features relatively high labour utilisation, which means that the key barrier affecting GDP per capita is labour productivity (OECD, 2015). Peru’s labour productivity represents close to 30% of the average for OECD member countries. Furthermore, although some progress has been observed in the past decade, the labour productivity gap has increased, compared to the 1980s (Figure 2.1).

Figure 2.1. Labour productivity gap in Peru and selected benchmark countries (% of OECD average), 1980-2016

Note: Labour productivity per person employed in 2014 in USD (converted to 2014 price level with updated 2011 purchasing power parities [PPPs]).

Source: Based on The Conference Board (2016), Total Economy Database (database), The Conference Board, New York, www.conference-board.org/data/economydatabase/ (accessed on 1 July 2016).

StatLink  http://dx.doi.org/10.1787/888933411198

Improving total factor productivity and human capital will be key for promoting labour productivity. Labour productivity, calculated as the output per worker, can be broken down into human capital, physical capital and total factor productivity (TFP). Compared to the United States, Peru’s TFP alone accounts for 49% of the labour productivity gap; years of schooling accounts for 27% and quality of education accounts for 22%. Peru’s TFP has grown at an annual rate of less than 2% over the last two decades – not enough to close the gap with OECD economies and most of the benchmark countries (OECD, 2015).

Recent policies adopted in education are welcome and these efforts should continue in the years ahead to boost labour productivity and inclusive development. Some recent policies such as incentive mechanisms to improve the quality of teachers, the implementation of “jornada única” (full-time school model) to avoid the prevalence of two or even three-shift schools, the creation of SUNEDU (Superintendencia Nacional de Educación Superior Universitaria) as an independent body for supervision of the quality of higher education, further investment in school infrastructure, in particular in remote areas, and the development of platforms to increase information on labour demand such as “Ponte en Carrera” are determinant to improve the quality of education for all Peruvians. Further fiscal resources and improvements in the effectiveness of public expenditures are fundamental to close the educational gap in Peru (Chapter 4; OECD, 2016a). The importance of these issues is reflected in the OECD’s Country Programme for Peru, which includes various reports on these themes: first, a vocational education and training review, focusing on the functioning of the VET system and on ways to improve it. Second, an “Investing in Youth” review, which will deal with issues related to the school-to-work transitions of youth and provide policy options to improve this. Finally, the Country Programme also includes an OECD Skills Strategy for Peru, which provides a comprehensive assessment of the main skills challenges and needs in the country.

Labour productivity varies widely across firms and economic sectors in Peru. The few sectors with high labour productivity, such as mining and finance, create few jobs. By contrast, retail and restaurants, and agriculture create close to half the employment and remain the lowest productivity sectors in Peru (Chapter 4). Furthermore, the productivity of firms exhibits high heterogeneity, compared to other Latin American economies and especially to the United States. While in Peru, the ninetieth percentile of most productive firms are 500% more productive than the tenth percentile, in the United States, it is approximately 200%, highlighting significant disparities in the allocation of production factors in Peru (Vostroknutova et al., 2015).

The total change in productivity can be broken down into a “within-sector” effect (driven by technical change and capital accumulation), a “between-sector” effect (driven by reallocation of labour resources between sectors) and a “cross-sector effect” (driven by the interaction between productivity changes and employment shares).

Within-sector accounted for the largest proportion of total labour productivity growth in the last decade in Peru. Positive within-sector and between-sector largely offset the negative cross-sector (Kaldewei and Weller, 2013). This is the result of the closing productivity gap between growth in slow-growing sectors gaining employment share and fast-growing sectors, such as mining, losing employment share. In the period 2002-12, while cross-sector contracted by more than 2%, within-sector expanded by more than 34%, and between-sector expanded by more than 12%. Most of the within-sector gains come from services and agriculture (Figure 2.2). Regarding the mining sector, most of the labour productivity gains come from the reallocation of labour, while within-sector and cross-sector were negative.

Figure 2.2. Labour productivity growth (%) by economic sector in Peru, 2002-12

Note: The total economy is the sum of the economic sectors and is represented as PERU in Figure 2.3.

Source: OECD calculations based on data provided by the National Institute of Statistics (Instituto Nacional de...

Produkt-Details

• Erscheint lt. Verlag: 14.10.2016
• Sprache: englisch
• Themenwelt: Wirtschaft ► Volkswirtschaftslehre ► Makroökonomie
• ISBN-10: 92-64-26536-8 / 9264265368
• ISBN-13: 978-92-64-26536-3 / 9789264265363