Most of the gap in GDP per capita between Peru and the OECD economies can be explained by Peru’s low labour productivity. The few economic sectors in Peru with high labour productivity, such as mining, create only a small number of jobs. Improving total factor productivity will be key for promoting inclusive growth. A national strategy needs to be implemented to take advantage of Peru’s natural resources to capture further valueadded. Upping the levels and quality of investment in research and development, innovation, transport infrastructure and logistics will boost competitiveness and increase efficiency. Continuing to improve the business environment, including contract and competition enforcement and support to small businesses will all help boost confidence and promote sustainable development.