Over the last decade, Peru has emerged as one of the strongest economic performers in South America. Peru has logged twelve consecutive years of positive growth and in 2009, the country reached upper-middle income status. This year, the Peruvian economy is forecast to grow by a robust six percent, largely on the backs of mining and mineral exports. Amid Peru’s longest economic expansion on record, the national poverty rate has plummeted 28 percentage points since 2004 to 27.8 percent.
Yet despite this dramatic reduction in poverty, widespread social inequities continue to persist in Peru. According to the United Nations, Peru is the 22nd most unequal country in the world. In Peru’s rural areas, the poverty rate stands at nearly 60 percent, well above the national average. Against this backdrop, in June 2011, Ollanta Humala was elected president of Peru on a platform of social and economic inclusion. Humala has announced plans to ramp up social spending in a bid to reduce the country’s poverty rate to 15 percent by the end of his term in 2016.
In its 2012-16 country development cooperation strategy for Peru, the U.S. Agency for International Development reaffirms Washington’s continued support for the South American nation. Through 2016, USAID Peru will focus its resources on achieving the following objectives:
Increasing alternatives to illicit coca cultivation in targeted regions
Improving the management and quality of public services in the Amazon Basin
Fostering sustainable management of natural resources in the Amazon Basin and glacier highlands
USAID will prioritize assistance to the five Peruvian Amazon regions of San Martín, Ucayali, Amazonas, Loreto, and Madre de Dios. These five regions have become hubs for coca cultivation, drug trafficking, and illegal logging and mining. In line with the USAID Forward reform agenda, the U.S. aid agency pledges to increase its use of country systems as well as bolster its engagement with local organizations in Peru.