Peru's rapid progress in improving its investment climate reflects the government's broad reform agenda targeting the laws and day-to-day administrative procedures that regulate how businesses start-up, operate, and grow. In FY10, Peru recorded several reforms tracked by Doing Business, including expanded online business registration linked to all of Lima's notaries and an adapted law setting time limits for construction project approvals.
Momentum for reform accelerated in July 2010 when Minister of Economy and Finance Luis Carranza announced an ambitious reform plan that would boost Peru to among the top 25 countries in the global ranking of the Doing Business indicator measuring ease of doing business. Teams mobilized across the World Bank Group to provide a coordinated effort. Technical assistance focused on projects in the areas of municipal inspection reform, property registration, trade logistics, judicial reform, tax administration, and insolvency procedures. We helped upgrade an electronic system for business start-up—which previously had few users—enabling new companies to register their entities online in 72 hours.
The reforms also reached local governments. The Ministry of Economy and Finance introduced a cash-transfer program for municipalities that conditioned disbursements on meeting certain goals, which included measures to ensure the consistent application of business licensing and construction permitting laws.
Peru's ranking among the top-10 reformers in Doing Business 2011 is reflected in reforms measured by the starting a business, dealing with construction permits, and registering property indicators. The country has reduced the time spent starting a business from 41 to 27 days and the cost by 19 percent. The number of companies that used the online business start-up system in the first half of 2010 was 166 percent more than in 2009. The introduction of a new legal framework for construction and additional administrative reforms has cut the time needed to comply with construction approvals by 15 days to 188 days. The property registry, which was already among the most efficient in the region, introduced a fast-track procedure that enables a business to complete a standard property transfer in a week. A new law passed in June 2010 further reduces procedures for starting a business and obtaining construction permits and allows for the use of electronic accounting books.