IDB Approves $177M Loan to Modernize Peru’s Prisons and Cut Recidivism

The Inter-American Development Bank (IDB) has approved a loan of up to $177.3 million to support Peru’s ambitious programme to modernize its prison system, strengthen rehabilitation initiatives, and reduce the country’s high rates of recidivism.

Comprehensive Prison Reform in Peru

The initiative, titled the Comprehensive Improvement of Social Reintegration Services in Peru, will be led by the Ministry of Justice and Human Rights. Its goal is to improve the reentry of prisoners into society by expanding access to individualized rehabilitation programs, strengthening prison staff training, and introducing modern management practices across facilities.

With overpopulated and outdated prisons straining Peru’s justice system, the reform aims to transform incarceration into an opportunity for rehabilitation rather than a cycle of repeat offending. The project is expected to directly benefit inmates through educational, employment, and treatment programmes designed to prepare them for life after prison.

Reducing Recidivism and Improving Public Security

One of the key objectives of the project is to reduce Peru’s reincarceration rate, which currently stands at 24 percent. By 2030, the programme seeks to bring this down to 21 percent, contributing to greater public security and community well-being.

The project also aims to professionalize the prison system workforce. Nearly 4,000 new agents and professionals will benefit from training and career development opportunities, helping to build a modern, capable, and accountable corrections system.

Part of a Broader National and Regional Strategy

The reform aligns with the IDB Group Country Strategy with Peru 2022–2026, which emphasizes institutional strengthening, the rule of law, sustainability, and digital transformation. By enhancing capacity within the prison system, the initiative also supports broader efforts to modernize the state and promote effective governance.

The loan is part of the Alliance for Security, Justice, and Development, a regional initiative launched by the IDB to strengthen justice institutions, improve security, and counter the growth of organized crime in Latin America and the Caribbean. The Alliance fosters dialogue and cooperation among member countries, and this Peruvian project is its second major undertaking since its creation. It is also the first to actively draw on the Alliance’s international network of partners to design and implement effective rehabilitation models.

Impact on Communities

Beyond the prison walls, the initiative is expected to have far-reaching social impacts, particularly in Lima and Ancón, where many of the reforms will be concentrated. By reducing repeat offending and giving inmates skills to reintegrate successfully, the project aims to enhance community safety while addressing the social and economic costs of crime.

A Step Toward Lasting Change

For the IDB, the loan signals a long-term commitment to supporting Peru in transforming its justice system. For the Peruvian government, it represents a chance to tackle persistent challenges in the prison sector and invest in solutions that prioritize rehabilitation over punishment.

As the IDB noted, effective social reintegration not only benefits individuals and communities but also strengthens democracy and stability by upholding the rule of law and creating safer, more resilient societies.