IMF Staff Country Reports

Peru: Selected Issues

May 21, 2024

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Format: Chicago

International Monetary Fund. Western Hemisphere Dept. "Peru: Selected Issues", IMF Staff Country Reports 2024, 134 (2024), accessed November 12, 2024, https://doi.org/10.5089/9798400276729.002

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Summary

The Selected Issues paper focuses on productivity and growth in Peru. Firms have maintained smaller sizes to avoid the application of a profit-sharing legislation, which has resulted in lower productivity. After a decade of high economic growth averaging over 6 percent per year, potential growth has been falling since 2014. A much slower pace of investment and human has driven the decline capital accumulation, but most notably, a decline in total factor productivity growth. In line with the macroeconomic trends, firm-level productivity has worsened, and the decline has been broad-based across the economy. Special corporate tax regimes and labor legislations and regulations have created barriers to productivity growth. To raise productivity, policies will need to focus on reforming regulations that impose excessive costs to formalizing or growing a business. Down the line, introducing greater labor market flexibility would ensure that workers could transition to productive sectors of the economy and reduce labor informality.

Subject: Artificial intelligence, Climate change, Environment, International organization, Monetary policy, Natural disasters, Potential output, Production, Productivity, Technology

Keywords: Artificial intelligence, B. artificial intelligence, B. Measuring productivity, Building RESILIENCE, Caribbean, Climate change, El Niño shock, Global, Labor force complementarity, Natural disasters, Potential output, Productivity, Total factor productivity growth

Publication Details

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