In the landscape of Peruvian legislation, few recent decrees have generated as much discussion and controversy as Decreto Supremo N° 160-2020-PCM. Issued in October 2020 against the backdrop of the COVID-19 pandemic, this decree formally titled *”Decreto Supremo que aprueba los Lineamientos para la reanudación de actividades económicas de manera gradual y progresiva dentro del marco de la declaratoria de Emergencia Sanitaria Nacional por las graves circunstancias que afectan la vida de la Nación a consecuencia de la COVID-19″* (Supreme Decree approving the Guidelines for the gradual and progressive resumption of economic activities within the framework of the declaration of a National Health Emergency).
To understand modern Peruvian economic policy, one must understand DS 160. It represented a pivotal shift from a strict, centralized lockdown model to a decentralized, sector-by-sector approach to managing public health and economic survival.
What is Decreto Supremo 160?
At its core, DS 160 was a regulatory roadmap. It established the technical and operational guidelines for businesses to resume operations safely. Before this decree, economic reactivation was managed through a strict “phase” system (Phase 1, Phase 2, etc.), where the central government dictated exactly which sectors could open and when.
DS 160 dismantled that rigid structure and replaced it with a level-based alert system. It tied the permitted economic capacity (e.g., “maximum 40% capacity in stores”) to the alert level (Moderate, High, Very High, or Extreme) of the specific province or department.
Key Provisions and Scope
The scope of DS 160 was vast, affecting nearly every aspect of commercial and social life:
1. Decentralization of Authority
Perhaps its most significant feature was the transfer of decision-making power to local and regional governments. It empowered Regional Governors and Local Mayors to request the central government to raise or lower alert levels based on local data, such as hospital bed occupancy and infection rates. This aimed to avoid a “one-size-fits-all” approach that had paralyzed the entire country, even when some regions had low infection rates.
2. Sector-Specific Guidelines
The decree did not simply say “open up.” It mandated the creation of sector-specific health protocols. It distinguished between:
- Activities not subject to capacity limits: Essential services like health, energy, and telecommunications.
- Activities with specific regulations: Retail, shopping malls, restaurants, gyms, cinemas, and places of worship all had specific capacity limits depending on the alert level.
- Activities with special protocols: Sectors like mining and construction had to follow additional guidelines issued by their respective ministries.
3. Articulation of Public and Private Responsibility
DS 160 legally obligated private companies to implement “COVID-19 Prevention and Surveillance Plans.” This meant businesses were responsible for temperature taking, regular sanitization, ensuring social distancing, and managing employee health. Failure to comply could result in temporary closure and fines.
The Impact: Economic and Social
Economic Relief
For a struggling economy that had contracted drastically, DS 160 was a lifeline. By allowing for “gradual and progressive” reopening, it permitted:
- Job Recovery: Sectors like gastronomy and commerce could rehire staff, albeit initially at reduced hours.
- Supply Chain Stability: It cleared legal ambiguities regarding which industrial sectors could operate, stabilizing production chains.
- Consumer Confidence: By establishing clear, public rules (e.g., “In High Alert, cinemas operate at 40%”), it gave consumers a predictable framework to plan their activities.
Political and Social Controversy
Despite its economic necessity, DS 160 was heavily criticized, particularly by the medical community and local governments who felt sidelined.
- The “Second Wave” Accusations: When Peru faced a severe second wave of infections in early 2021, critics pointed to DS 160 as the culprit, arguing that the decentralization and loosening of restrictions came too fast.
- The “Lack of Licencing” Clause: A specific clause in the decree allowed businesses to operate while their formal licences were being processed if they had filed a “receipt” of application. This led to accusations that the decree was encouraging informal commerce and unsafe constructions, sparking protests from local municipalities who claimed it violated their zoning authority.
- Implementation Gaps: While the decree handed responsibility to businesses to implement safety plans, state oversight (SUNFIL, municipalities) was often understaffed, leading to uneven enforcement.
Legacy and Current Status
Decreto Supremo 160 was eventually modified and superseded by subsequent norms as the pandemic evolved and vaccination rates increased. However, its legacy remains significant.
It established a precedent for risk-based governance in Peru. It demonstrated that the government could move beyond blanket quarantines and manage a health crisis by using data to calibrate economic freedom. For businesses, it underscored the importance of operational flexibility and the need for robust health and safety protocols.
Conclusion
DS 160 was more than just a pandemic rulebook; it was a balancing act between the undeniable need to salvage a collapsing economy and the imperative to protect public health—a balance that nations around the world struggled to find.