Evaluation of Japan’s ODA to the Republic of Peru

Chief Evaluator	SHIMIZU Tatsuya Group Manager, Latin American Studies Group, Area Studies Center Director, Institute of Developing Economies, Japan External Trade Organization (JETRO)
Advisor	ISODA Saori Assistant Professor, Faculty of Foreign Languages, Department of Spanish and Portuguese, Spanish Major, Kanda University of International Studies
Consultant	Japan Techno Co., Ltd.
Evaluation Period	FY2011 to FY2020
Period of the Evaluation Study	August 2021 to March 2022
Field Survey Country	Peru (online survey)

Background, Objectives, and Scope of the Evaluation

Peru was the first country that Japan established diplomatic relations with in the Latin America region in 1873. In 1899, Peru became the first country to which Japanese people immigrated to in the South American continent, and today there are approximately 100,000 people Japanese-Peruvians. The country has a long history of friendly relations with Japan. In addition, Peru is the largest recipient of Japanese ODA in Latin America on a cumulative basis.

The objective of this evaluation is to evaluate assistance policies for Peru over the past 10 years and to obtain recommendations and lessons learned for the planning and implementation of assistance policies for Peru by Japan in the future. In addition, this report also aims to ensure accountability to the general public by publishing evaluation results, and to provide feedback on the evaluation results to relevant governments and other donors.

Summary of Evaluation Results

● Development Viewpoints

(1) Relevance of Policies

Japan’s assistance policies for Peru are consistent with Japan’s high-level ODA policies, such as the Official Development Assistance (ODA) Charter (2003), Development Cooperation Charter (2015), as well as with Peru’s mid- to long-term and sector development plans. In addition, the policies are consistent with the MDGs, SDGs and other international priority issues, as well as with the direction of assistance provided by other donors to Peru. Furthermore, policies are being formulated focusing on areas where Japan has a comparative advantages.
(Evaluation Result: Highly Satisfactory)

(2) Effectiveness of Results

The amount of Japan’s ODA to Peru has been declining because Peru is classified as a upper-middle-income country (UMIC), however, Japan has been providing assistance to Peru, which has diverse aid needs in its mountainous and Amazonian regions, by focusing on projects in the three priority areas (Improvement of socio-economic infrastructure and narrowing disparities, environmental measures, and disaster prevention and recovery measures) and utilizing the comparative advantages of Japan in these areas. In the field of Improvement of Socio-Economic Infrastructure and Narrowing Disparities, improvements have been made to alleviate poverty in Peru; in the field of Environmental Measures, irrigation facilities have been developed in mountain regions and the harvest volume of farmers has been increased; and in the field of Disaster Prevention and Recovery Measures, the knowledge and experience of Japan have been used to develop infrastructure resistant to disasters and strengthen the alert/warning system, and the government has proactively implemented disaster drills which have resulted in a certain degree of disaster awareness at the national level.
(Evaluation Result: Highly Satisfactory)

(3) Appropriateness of Processes

Appropriate discussions are held between relevant stakeholders in Japan and Peru in order to formulate the Country Development Cooperation Policies for Peru, and Rolling Plans are updated every year. During the implementation process, the following activities are being carried out: development of the implementation structure, identification of needs, and implementation of individual projects based on the ODA priority areas in Peru, monitoring, and public relations activities.
(Evaluation Result: Highly Satisfactory)

(Note) Ratings: Highly Satisfactory; Satisfactory; Partially Satisfactory; Unsatisfactory

● Diplomatic Viewpoints

(1) Diplomatic Importance

From the perspective of diplomatic importance, Japan is promoting the overseas business deployment of Japanese companies and working to strengthen economic relations through EPA, investment agreements, promotion of the establishment of tax treaties and other legal frameworks, and discussions based on this type of framework which contribute to creating a business environment that promotes trade and deployment of companies. In addition, Japan and Peru are cooperating and working together on a number of international common issues, such as disaster prevention including earthquakes and tsunami, environmental and climate change issues, nuclear disarmament and non-proliferation, reform of the United Nations Security Council, North Korean issues, and South China Sea and East China Sea issues. In terms of the importance of the partner country based on Japan’s diplomatic principles, the facts that both countries have a diplomatic relationship which exceeds 140 years and are strategic partners which share universal values were reaffirmed at the foreign ministers’ meeting in 2020, indicating the high level of the relationship between Japan and Peru. High-level discussions that include the flow of key figures have continuously taken place between Japan and Peru since 2011, and it is thought that closer exchange and promotion of understanding between political leaders will contribute to the security and prosperity of Japanese expatriates in Peru and the Japanese-Peruvian community. From this point of view, Japan’s ODA to Peru has diplomatic importance.

(2) Diplomatic Impact

From the perspective of the impact on bilateral relations (promoting friendship, etc.), there is an ongoing record of exchange between Japan and Peru since 2011. Furthermore, there are many cases in which the results of assistance by Japan have contributed to promoting friendly relations. In addition, from the perspective of support for the position of Japan in international community, it is expected that Japan and Peru will deepen the close relationship to facilitate cooperation between Japan and Peru in order to respond to international issues, and Peru has a remarkable record of activity in international community in such varied fields as reform of the UN Security Council, trade, environment, nuclear disarmament and non-proliferation. Furthermore, from the perspective of the impact on strengthening economic relations, such as the business deployment of Japanese companies in Peru, it has been confirmed that the number of Japanese company facilities has increased. Thus, the provision of ODA from Japan to Peru can be found to have the diplomatic impact of facilitating better relations.

Recommendations Based on Evaluation Results

(1) Maintain Basic Policy of “Contributing to Sustainable Economic Development”

The provision of assistance to facilitate sustainable economic development is needed to enable Peru to recover from the years of political crises in the latter half of the 2010s followed by the disaster of the novel coronavirus, which has been called the worst-case on the South American continent and matches the needs in Peru. Therefore, it is important to strengthen bilateral relations and cooperate to solve global issues.

(2) “Selection and Concentration”: Continued Assistance through Various ODA Schemes in Three Priority Areas

The issues and social needs for “improving socioeconomic infrastructure and narrowing economic disparities,” “environmental measures” and “disaster prevention and recovery measures” remain unchanged, and the basic development course for Peru has also not changed. These are areas in which the utilization of Japanese technology can be expected to have a large impact, and continued assistance is needed in the future.

(3) Strengthen Cooperation with Funds and Activities of Diverse Entities

In view of the effective utilization of Japan’s ODA budget and a fall in assistance capital to Peru in future, strengthening cooperation with funds and activities of diverse entities that are contributing to development is much more important. Therefore, it is important to actively utilize public-private partnership schemes to formulate and implement successful projects, and to continue to focus on inter-project collaboration and collaboration with international organizations.

(4) Necessity of Continuing Technical Cooperation That Leads to Long-Term Human Resource Development

In order to respond to the need to introduce new technology through technical assistance that is desired on the Peruvian side, startup support at universities, SATREPS and other assistance schemes can be utilized in addition to the technologies of private companies in order to deepen cooperation among universities and research institutes.

(5) Maintain Cooperation with Communities of Japanese Descendants

The Japanese-Peruvian community has served as a recipient of Japan’s ODA and a bridge-builder for development effects of ODA projects to Peruvian society as a whole. The cooperation that contributes to maintaining the identity and further enhancing the cultural, social, and economic status of the Japanese Peruvian community is an effective means to regard them as an ODA cooperation partner for Japan, and should be continued in the future.

(6) Responding to Infrastructure Needs in Consideration for Peru’s Natural Environment and the Impact of Climate Change

Assistance through various ODA modalities for infrastructure needs should be continuously reviewed. When this review is performed, the natural environment in the target region and the impact of climate change need to be adequately considered while keeping in mind the decentralization that is being promoted in Peru. It is also necessary that there is sufficient consideration for the response to local residents in particular and support for consensus building among varied stakeholders.

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