Peru will launch a program to improve the productivity and competitiveness of its economy with a $300 million loan from the Inter-American Development Bank (IDB).

This operation is the second in a series of two independently financed but technically linked programmatic loans to support policy reforms. The first $50 million operation was approved in 2019.

The new program aims to strengthen public institutions that work to enhance competitiveness, improve regulatory quality to increase private investment, and foster innovation.

One component of the program will solidify the institutional structure for implementing the National Competitiveness and Productivity Plan. The program will also design a proposed national quality system and reinforce the Specialized Executive Boards Team and the Specialized Investment Monitoring Team, among other measures.

The program will also seek to improve the investment climate by raising the quality of regulations for specific industries, in areas affecting multiple industries, and for planning. These actions include support to foster a more competitive and sustainable forestry industry, measures to sustainably expand markets for aquaculture, and work to modify the regulatory framework for prior consultation to streamline the application of regulations during the prospecting phase of mining operations.

Additionally, to improve the quality of regulations that support innovation, the program will work to integrate the operations of the National Innovation Program for Competitiveness and Productivity and the National Fisheries and Aquaculture Innovation Program. It will also consolidate existing programs under a national innovation agency and restructure the National Council for Science, Technology and Technological Innovation. Finally, it will seek approval for a strategy and regulatory framework for strategically developing and strengthening the management model and network of the Center for Productive Innovation and Technology Transfer.

The program will benefit legally registered productive enterprises—particularly in the industries of forestry, aquaculture, and mining—as well as legally registered innovative enterprises and innovative entrepreneurs by improving public policies in their respective areas.

The $300 million IDB loan has a 20-year term, a 5.5-year grace period, and an interest rate based on the Secured Overnight Financing Rate (SOFR).