Activities Supported by the Program

Pillar 1. Technical support to implement reform recommendations and adopt OECD standards in Peru Public Disclosure Authorized

Innovation

Year 1

Aggregated database on STI indicators -- Report June 30, The deliverable provided a first aggregated database on STI indicators in Peru. Before Report on methodology, questionnaire, and 2016 this exercise, Peru did not have an aggregated database that allowed to identify how primary data for innovation impact much is spent on STI, and by whom, as well as the type of expense. Compiled assessment comprehensive data on public expenditure on STI by agency and type. Mapping of Public Expenditure on STI in Report June 30, The report provides an analysis on the expenditure on STI in 2015 by objective, type of 2015 in Peru report 2016 instrument, beneficiary, etc.

Workshop for Methodology Transfer of the Workshop June 27-July The team held a Workshop where it launched the transfer of the methodology of the Public Expenditure Review on STI 1st, 2016 Public Expenditure Review on Innovation to CONCYTEC and other relevant institutions, Public Disclosure Authorized shared good practices and lessons learned from applying the methodology in other countries; and presented the results of the preliminary study on data collection of STI expenditure done for Peru.

Year 2

The Ministry of Economics and Finance has created working tables on prioritized areas Supporting CONCYTEC in setting up of identified in the Plan de Competividad, and MEF and Concytec have been co-chairing the Report Dec 2018 Innovation Roundtables one on Innovation. The project team offered support to the working table by sharing similar experiences of other countries. One of the components under the Innovation loan (The Public Expenditure Review) will also serve to inform this activity. Beginning in 2017, work under this component assumed by the Strengthening the Science, Technology, and Innovation System loan (P156250, US$45 million, TTL Alberto Criscolo), currently ongoing with CONCYTEC. Public Disclosure Authorized

Statistics

Year 1 Public Disclosure Authorized Multidimensional Poverty Measurement Workshop March 1-3, Discuss the Alkire – Foster Index to measure multidimensional poverty and its 2016 application and viability in Peru. Partner with INEI and Oxford Poverty and Human Development Initiative (OPHI). Aide Memoire: Adapting to Peru the Report May 9, 2016 Following a mission on National Accounts, the report analyzed the current status of annual, quarter experience of OECD members on statistical and regional available statistics used in the construction of Peru’s National Accounts in order to management identify the information gaps towards the future implementation of National Accounts with moving base year and chained indices and further OECD requirements. This activity was helpful as INEI was able to benchmark its current status in the four main areas pointed out in the OECD report and develop a roadmap to fill the identified gaps. Lessons Learned from LAC countries in their Workshop May 24-25, Bolster knowledge exchange between Peru and LAC countries that already belong to process of accession to the OECD 2016 OECD (i.e Chile and Mexico) as well as those in the accession process (i.e Colombia and Costa Rica) and receive recommendations in this regard. Partnered with INEI (Peru), DANE (Colombia), INEGI (Mexico), INE (Chile) and INEC (Costa Rica). Going forward Strategy - Gaps and Report May 24, 2016 Report providing input to the 17 actions recommended by OECD to INEI: filling Challenges of National Statistics questionnaires and providing guidance for implementation. Clients asked to instead develop a forward-thinking strategy for INEI to rise up to OECD standards. The strategy includes a long-term vision and key challenges ahead.

Year 2

N/A

Environment

Year 1

Aide Memoire/report on participation of the Report March 2016 The presentation made by the Peruvian delegation and the review undertook by OECD WBG in the Peer Review process of the Peru and ECLAC were well received. The multisector representation of the Peruvian Environmental Performance Review in the delegation made a good impression to the OECD WPEP. In the meeting, the Peruvian OECD on March 9, 2016 delegation committed to prepare an implementation Plan.

Study on Implementation at National level of Report May 25, 2016 The report summarizes the findings and recommendations on the PRTR. It provides a the Pollutant Release and Transfer Registers detailed description of the characteristics of the PRTR and compares the Peru PRTR with (PRTR) of Peru and its assessment vs the recommendations of the OCDE, the PRTR protocol and other good practice PRTRs. It international requirements (OECD and UN) identifies gaps and provides recommendations to address these gaps, including a preliminary estimate of the financial resources required to close these gaps Final Report. Reviewed Action Plan for Report June 24, The final review report included information gathered from three technical workshops implementing recommendations of the 2016 organized by MINAM to present the EPR Implementation Plan to targeted sectors and OECD/ECLAC Peru Environmental get corresponding feedback. The review of the EPR Action Plan contributed to generate Performance Review and its relationship domestic knowledge on how to adapt policy, laws and reform sequencing when adopting with OECD Acts and Sustainable OECD environmental standards. Also, this deliverable allowed the WBG to participate in Development Goals the policy dialogue with the GoP (MINAM) on OECD environmental standards. Presentation of Final Report Workshop June 2016 MINAM organized a consultation event on the PRTR. The WBG presented and participated in the discussion.

Year 2

Three technical reports on conforming to Report December Technical reports were prepared including diagnostic and recommendations: i) Pollutant OECD standards related to Environmental 2017 Release and Transfer Register (PRTR), ii) Response to Accidents Involving Hazardous Performance Chemical Substances, and iii) Management of Solid Waste. Dissemination Workshops for each technical Workshop Dec 7-14, Workshop topics included: "Peru's negotiation proposal on the application of the PRTR against the report 2017 OECD standards" (Dec 7th); "Communication and Public Participation Related to the Prevention and Response to Accidents Involving Hazardous Chemical Substances, in the Framework of the OECD" (Dec 13th); and "Proposal for Negotiation of Peru with a View to Entering the OECD - Recommendation (September 28, 1976 - C (76) 155 / Final) Regarding the Comprehensive Management of Solid Waste in the Context of the Circular Economy" (Dec 14th).

Integrity

Year 1

Note guiding the institutional redesign of the Report April 29, Document which presented the initial diagnosis of the Anti-bribery commission (CAN) institutional strengthening of the High 2016 and the methodological and theoretical framework to build the organizational structure Commission Against Corruption (CAN) of the CAN. The proposed reforms would allow CAN to have a more independent and relevant role in the fight against corruption, particularly by having a stronger role in the design and monitoring of public policy. Workshop on Corporate Responsibility in Workshop May 24-27, The Workshop provided support to the dialogue established with other countries, Transnational Corruption 2016 contributed to the institutional framework to apply the new law against international bribery, and ensured the new law is correctly and consistently applied by preparing guidance on good practice by creating capacity among 20 judges and prosecutors. Comments on international best practice on Report May 30, 2016 Summary description of international best practice on preventing corruption in anti-bribery regulation for Law 30424 on international transactions, particularly through the establishment of "compliance bribery on international transactions programs" on the integrity of the private sector, which serve to certify probity of transactions and businesses. the document focuses particularly on the regulatory framework in countries with such compliance programs.

Draft law to establish CAN as a Technical Report June 16, First draft of the law that creates CAN as a Technical Specialized Organ. Includes the Specialized Organ 2016 regulation of the main functions, governing bodies, competencies, economic and labor regime, among others Comments on the new regulation on anti- Report June 30, Two versions of the regulation for Law 30424 were shared with the WBG and two rounds bribery - Law 30424 2016 of comments were delivered.

Good Practice Manual for the new legal Report June 30, This deliverable on the investigation and adjudication of international bribery framework on Antibribery in Peru 2016 summarizes an extensive research on the newly passed Peruvian legislation, the results of the workshop and brief explanation of international cases. This deliverable will help ensure the new law is correctly applied. International benchmark of Anti-Corruption Report June 30, Comparative study to identify how the Anti-Corruption Agencies work in other countries, Agencies 2016 particularly OECD members such as Poland, Romania, South Korea, Colombia (in process of accession) and the UK. Includes an analysis of the main functions, organizational structure and relation with other agencies.

Year 2

N/A

International Taxation

Year 1

Comments to draft law on Exchange of Report April 2016 Information Exchange of Information (The Last Mile) Workshop April 18-20, This 3-day seminar introduced tax auditors and investigators from the LAC region to the 2016 concepts and practices of EOI with an emphasis on case studies and sharing practical experience. The seminar was also designed to enable participants to replicate such training across their own countries. The tax auditors were encouraged to make effective use of EOI tools to increase the number and quality of outgoing requests for information. The seminar also demonstrated how the effective use of EOI networks can tackle cross-border tax evasion and improve their tax audits. Automatic Exchange of Information Workshop April 21, This one-day workshop introduced the main aspects of the new standard on automatic 2016 exchange of financial information for tax purposes (“Common Reporting Standard” – “CRS”) that were presented by experts at the Global Forum on Transparency and Exchange of Information. Representatives of the tax administrations of Colombia, Mexico and Chile also shared their experiences in the field of FATCA, CRS and exchanges of information practiced under this modality with respect to different categories of income and assets. BEPS (Base Erosion Profit Shifting) Actions 8- Workshop May 30 – The workshop explored technical and legal aspects to be considered for the implementation 9 June 1, of Actions 8 and 9 of the BEPS project in Peru. 2016 Mission was held on BEPS and Exchange of Mission March Additional discussion and recommendations focused on banking secrecy, transfer pricing Information in 2017 (TP) documentation, beneficial ownership (BO), mutual assistance, multilateral Instrument (MLI), and BEPS in general. SUNAT, MEF and Bank team agreed on priorities for the following months Year 2

A mission traveled to Lima jointly with the OECD and the Technical Assistance Office of the September Treasury Department of the United States of America (OTA), with the objective to continue Mission on Transfer Pricing with OTA Mission with the technical assistance to the MEF and the Superintendence (SUNAT) in matters of 2017 international taxation. During the mission, the team met with officials of SUNAT to address issues related to transfer pricing. Following the implementation of this work throughout 2016-17 led by the program, the Tax team began direct collaboration with GoP under existing IFC advisory project Peru Tax (599794, TTL Ana Cebreiro Gomez) in 2018. Under this project, the Tax team has continued providing advisory to MEF and SUNAT on the implementation of the laws and defining high-impact management indicators to drive and monitor progress in achieving the institutional strategic objectives of the tax agency (SUNAT).

Trade Facilitation (Customs)

Year 2 (component assumed in year 2)

Mission to complete the Customs Mission August Mission to perform CATT assessment and define high impact management indicators that Assessment Trade Toolkit (CATT) 2017 allow to drive and monitor progress in achieving the Institutional Strategic Objectives of the SUNAT. Reports 1 and 2 of CATT Assessment and Reports December Parts 1 and 2 of the CATT Assessment and a Work Plan were presented in December 2017 to Work Plan 2017 SUNAT and relevant stakeholders. Legal Indicator Mapping

Year 2 (component assumed in year 2)

Legal Indicator Adhesion Map – including Report December This initiative was designed as a forward-thinking strategic tool to prepare for the OECD Consultation Follow-up Table and 2017 accession invitation. The project has worked with the Ministry of Foreign Affairs to map the Monitoring Table. process for "Supporting the Adhesion of Legal Instruments of the OECD", which is a part of the "Initial Memorandum"-- the first step required of Peru after receiving the accession invitation. Deliverables completed this period include: 1) Consultation follow-up table, which details all correspondence with Ministries and their respective responses regarding the state of OECD indicator adhesion efforts; 2) Monitoring table organized by OECD instrument, indicating the current state of all instruments (adhered, instruments with application for membership, instruments that are in the process of consultation and those pending response from the Ministries).

Pillar 2: Horizontal strategic advice in Peru

Year 1

Workshop to Communication Officials and Workshop March Promote knowledge on OECD issues and collect information on stakeholder management in Media (Journalists and opinion leaders) 2016 the country.

Strategic Guidelines to Promote Peru’s Report June 30, General overview of how Peru is addressing the OECD engagement context, and Country Brand in the OECD Context 2016 recommendations on institutional framework, quality control mechanisms, strategic communication, stakeholder management and strategic plan for positioning with the OECD. Comparative analysis of legal changes on Report June 30, Collect and synthesize background evidence on reforms, particularly those involving changes OECD membership process 2016 in legislation that took place during the OECD accession process in Chile, Israel, Colombia, Costa Rica and Baltic countries. The report includes a list of new laws identified through on- line search machines of Congress that included references to the OECD. Peru OECD Forum (October 14, 2016) Event October The 1-day forum provided a platform for high-level dialogue on Peru’s engagement with the 14, 2016 OECD and the progress of Peru’s Country Program, which aimed to inform both the public and private sectors on the benefits of developing the relationship with the OECD and potential impact it would have on Peru’s public policies. President PPK and Prime Minister Zavala both affirmed their intentions for full accession to the OECD by 2021; Angel Gurría also affirmed the support of the OECD in this endeavor. Peruvian Congressional visit to OECD HQ in Visit to Nov 14-15, The visit aimed to provide a direct dialogue to discuss how the OECD can offer assistance Paris Paris 2016 with the legislative reforms of the priority, and on the other hand to inform the way and the requirements for possible access. It also allowed Congressional members to get to know the OECD better, giving them the opportunity to obtain firsthand information on the implications of the relationship between Peru and the Organization and the how to use the tools of the OECD as a source of information for legislative work. Policy Notes on Peru's readiness for OECD Report April 10, At the request from the Presidency of the Council of Ministers (PCM), the program team led accession (7) 2017 the preparation of a document highlighting Peru’s strengths and seven Policy Notes on progress in seven topic areas, presented to the OECD Council during the vice-President’s mission to Paris OECD-Headquarters in mid-April 2017. Topics included i) Macroeconomic policies, ii) Poverty and inclusive growth, iii) financial sector, iv) International Trade, v) Private Sector Development, vi) Education, and vii) Public Governance. Vice president of Peru visits the OECD HQ in Visit to April 2017 VP Araoz met with Secretary General Gurría, made a presentation “Peru is a Reliable Paris Paris Partner” to the OECD Council (with input from WBG policy notes and receiving positive feedback), and met bilaterally 12 representatives from OECD member or accession countries.

Year 2

VC with international expert and PCM Workshop May 2017 The team organized a VC with representatives from the Government of Colombia who were representatives (VC) closely involved in the OECD accession efforts, in order to share best practices and structural advice with the government of Peru as they continue to organize their commission. In addition, a call was organized between PCM officials and an international expert from Costa Rica on Peru's short-term strategy vis a vis the OECD Council's upcoming decision for enlargement of members. High-level meeting between Peru's VP High-level June 2017 The objective of the meeting was to offer high-level strategic support and discuss the WBG's Mercedes Araoz, and T&C Director Anabel Meeting continued role in supporting the project Gonzales

Participation and organization of high-level High-level Aug 2017 Participation and organization of high-level meetings with Peru's President (Pedro Pablo meetings with the Government of Peru Meeting Kuczynski), Prime Minister (at the time, Fernando Zavala), Vice President (Mercedes Araoz), and Congress (Aug 2017). The objective of these meetings was to discuss the Government's strategy in its engagement with the OECD, and in the case of Congress to highlight the benefits that joining the OECD would bring to the country. These meetings helped to clarify Peru’s strategy regarding high-level institutional appointments of representatives to the OECD and the need for presence in Paris. Workshop on international experiences with Workshop Aug 2017 An international expert from Costa Rica joined the Peruvian government in Lima for a OECD accession related to internal workshop to strategize on Peru's internal approach to OECD accession and organization adhesion/adoption of standards. The workshop was attended by 75 participants and included topics such as information on the accession and decision-making processes, the importance of OECD accession for Peru, and strategy for implementation of reforms. Mission to Paris Materials for Paris HQ Visit to Sept 2017 The WBG team provided technical and strategic support for the mission of the Peruvian mission (Sept 2017), plus materials Paris, Delegation to Paris, led by Vice President Araoz and the Presidential Representative to the (brochures) Materials OECD, Enrique Felices. As part of the implementation of the Peru’s external communication strategy surrounding the OECD, the program produced two strategic reports and a brochure assessing Peru's progress on completing the OECD Country Programme and other OECD standards (“Peru Beyond the OECD Framework”). The brochure was delivered to the OECD technical committees and representatives of member countries during the visit in order to show the readiness of Peru for OECD accession and highlight Peru's accomplishments to the OECD Board.

Meeting of the Steering Group for the OECD OECD Nov 17, The project team has been cultivating the relationship with the OECD LAC Regional Program LAC Regional Program in Paraguay Event 2017 since the project inception, and has officially become members of the Steering Group since July 2017 (via request letter from VP Jorge Familiar). During the event, practice Manager Marialisa Motta presented examples of successful collaboration between the WBG with the OECD on productivity and suggested areas for potential future collaboration, including: the expansion of firm-level MULTIPROD data in Brazil; evaluation of productivity-specific projects, policies, and public spending; and exploring a framework for analyzing inclusive productivity. Second Ministerial Summit on Productivity in OECD April 2018 The WBG co-led the organization of the one-day Summit. The WBG organized one of the Latin America and the Caribbean in Costa Event main panel sessions and sponsored the travel of the invited experts participating in the Rica panel. Ministerial Meeting on Strengthening OECD Oct 2018 The WBG participated in the third High Level Meeting of the OECD LAC Regional Programme, Institutions and Governance in Latin America Event held in Lima, Peru on 18-19 October 2018, entitled “Integrity for Good Governance: from and the Caribbean in Peru and Meeting of commitments to action”. The project team also helped to co-organize the Ministerial the Steering Group for OECD LAC Regional Meeting and was represented in the panel on public procurement, chaired by the Peruvian Program Minster of Finance and Economics.

Annex 2: Indicator Program Results to Date

Outcomes Results to Date Details

Number of recommended procedures/firm-level 1. Environment Action Plan to adopt the OECD/ECLAC Environmental Performance Review 1 policies/practices/standards that were published by the Ministry of Environment improved or eliminated

1. Law against Anti-bribery; Number of OECD Standards/Instruments 5 2. Establishment of the National Pollutant Release and Transfer Register (PRTR) Adopted 3. Three International Taxation legislation: decrees 1312, 1313, and 1315;

Outputs Results to Date Details

Environment: - Action Plan to adopt the OECD Environmental Performance Review - Set up the Pollutant Release and Transfer Register at national level. Comments were made to a Supreme Decree Innovation: - PER analysis led to recommendations for improvement or elimination of STI instruments Number of procedures/firm-level Integrity: policies/practices/standards 27 - A draft law and a structure and functions report were prepared to strengthen CAN. recommended for improvement or International Taxation: elimination - Recommendations given on the Beneficial Ownership Decree - Recommendations given on the Banking Secrecy Decree; - Recommendations given on the tax treaty policy (inputs for the new model used for Peru in their 2017 negotiations, including with Japan) Trade/Customs: - Recommendations coming out of the CATT (Customs Assessment Trade Toolkit) Assessment (20)

Governance: - Recommendation of the Council on Principles for Public Governance of Public-Private Partnerships Environment: Number of OECD Standards suggested for 21 - Establishment of the national Pollutant Release and Transfer Register adoption Integrity: - Strengthen Commission on Anti-Corruption Policy - Convention on Combating Bribery of Foreign Public Officials in International Business Transactions International taxation: - Recommendations given on the implementation of the standards for EOIR (Exchange of Information on request) - Recommendations given on the implementation of the standards for AEOI (Automatic Exchange of Information) - Recommendations given on Harmful tax practices - Recommendations given on the signature of the Multi-Lateral Exchange - Recommendations given on the signature of the MAC (Mutual Administrative Assistance in Tax Matters) - Recommendations on the set up of the Exchange of Information Unit Environment: - C(96)41/FINAL - Recommendation of the Council on Implementing Pollutant Release and Transfer Registers (PRTRs) - C(88)85/FINAL - Decision-Recommendation of the Council concerning Provision of Information to the Public and Public Participation in Decision-making Processes related to the Prevention of, and Response to, Accidents Involving Hazardous Substances - C(76)155/FINAL - Recommendation of the Council on a Comprehensive Waste Management Policy. Trade Facilitation: - Recommendations coming out of CATT Assessment (8)

- Technical workshops on specific components, including International Taxation, Integrity, Statistics, Number of participants in workshops, International Taxation, Innovation, Environment (3), and Customs 1,179 training events, seminars, conferences, etc. - High-level “Peru OECD Forum” (700 attendees) - Workshop "Peru's Strategy Towards the OECD" (75 participants)

Technical Reports: Statistics - Report of the National Accounts Mission; Gaps and Challenges of National Statistics Environment - Reviewed Action Plan of the OECD/ECLAC Environmental Performance Review and links with OECD ACTS and SDG; Study on Implementation at National level of the Pollutant and Transfer Registers of Peru and its assessment vs international requirements (OECD and UN) Number of Reports Completed 33 Integrity - Diagnosis presentation; Draft law to establish CAN as a Technical Specialized Organ; Structure and functional proposal document; International benchmark of Anti-Corruption Agencies - Guide on the investigation and adjudication of international bribery; Comments on international best practice; Comments on the new regulation - Law 30424 Innovation - Database containing primary data for innovation impact assessment International Taxation - Review of draft tax legislation Trade/Customs - CATT (Customs) Assessments (Part 1 and 2) and Work Plan

Strategic Reports: - Brochure on "Peru as Reliable Partner for the OECD" + seven policy notes ( i) Macroeconomic policies, ii) Poverty and inclusive growth, iii) financial sector, iv) International Trade, v) Private Sector Development, vi) Education, and vii) Public Governance). - International Strategy for OECD Accession - Promotional Material and deliverables for OECD Council - Legal Indicator Mapping (by OECD instrument and by institution)