LOCARNO — Over 2009/10, Peru broke out, thanks to Claudia Llosa’s Berlin Golden Bear winner “The Milk of Sorrow,” Javier Fuentes-Leon’s “Undertow,” which took Sundance’s World Cinema Audience Award, and Daniel and Diego Vega’s “October,” which walked off at 2010’s Cannes with its Un Certain Regard Jury Prize.

Finally, a New Peruvian Cinema was born.

Three years later, there are few more anticipated Latin American second features than the Vega brothers’ “El mudo” which screens in competition Wednesday at Locarno.

“El mudo” underscores the filmmakers’ counter-establishment courage to make a putdown of a seemingly corruption-sodden modern-day Peru at a time that the country has become the darling of the financial world.

But the dramedy-thriller also says a lot about the paths top-end Latin American movies are now exploring.

“Sorrow” and Hector Galvez’s “Paradise,” which played Venice Horizons in 2009, were both set in Lima’s marginalized, humble outer-burbs.

But as Latin American cinema diversifies in style, abandoning a large focus on its once seemimgly hopeless downtrodden poverty, “El mudo,” in contrast, is set in Lima’s middle-classes, turning on Constantino Zagarra, a first-instance, office-bound magistrate.

He’s an honest man in what seems a dishonest country, pompous but principled, dealing out swinging jail-sentences, refusing to accept back-handers and fleeing cronyism; which is where his problems begin.

Demoted to an office in the sticks, shot in the neck and left speechless in “El mudo’s” early going, Zagarra sets out to put down by law his would-be assassin.

This might sounds like Clint Eastwood territory; but “El mudo” travels other film roads.

“’El mudo’ is about a man with good intentions in a country like Peru which is complicated, especially given his job,” said Daniel Vega.

Like an increasing number of Latin American movies, “El mudo” tips its hat to genre, Diego Vega said, here thrillers and film noir.

“El mudo” also had more resources than “October,” Diego Vega said.

It shot for five weeks, including in a real-life magistrate’s basement office at Peru’s Palace of Justice.

Also contrasting with the Vegas’ debut, crucially, “El mudo” accessed Peruvian state funding before it shot, which helped on a film which ranges far more over locations as Zagarra seeks justice from the police and a bigwig judge, and makes a liberal use of dolly and crane shots.

“El mudo” was co-produced by UDI’s Urban Factory in France, with UDI handling world sales rights, and Mexico City’s Nodream Cinema, owned by cult director Carlos Reygadas.

Pan-Latin American co-production is becoming more common as a new generation of directors and producers increasingly get to know one another and European funding dwindles.

Llosa is now in post on her English-language Dreamcatchers-sold Untitled Claudia Llosa Film, about a son tracking down his long-lost mother, with Jennifer Connelly, Cillian Murphy and Melanie Laurent.

Fuentes-Leon will shoot the UDI-sold “The Vanished Elephant,” which is produced by Urban Factory, Fuentes-Leon’s Elcalvo Films and Colombia’s Dynamo a partner in Participant Media’s Participant PanAmerica film fund.

“El mudo” pulled down coin from France’s World Cinema Support system.

Not all Peruvian films are so lucky.

“Peru isn’t happening like Colombia or Chile,” said Diego Vega. While a new Peruvian film law still pends approval, an energetic micro-budget movement has flowered in Peru, he added.

Many movies – Diego Vega cites Adrian Sava’s “The Cleaner” – are now being shot without government funding. Some screen at a new wave of Peruvian festivals, such as June’s Lima Independent Film Festival, whose jury members included “Uncle Boonmee” Cannes Palme d’Or winner, Apichatpomg Weerasethakul.

Whether funded or not, one major challenge for Peruvian movies is distribution in their own market.  “Although there are recent examples that tell us the contrary, Peruvian films carry a certain stigma in Peru,” said Daniel Vega.

“It’s very difficult to project recoupment if you pay for your own distribution.”

The Vegas’ Lima-based Maretazo Cine will apply for a governmental distribution grant for Peru, he added.