Among the benefits of democracy, some of the most pleasing are the open exchange of ideas, the encouragement of creativity and citizenship, and of course freedom. These all have intrinsic value in addition to supporting social and economic development. Yet there are other benefits, as the Economist points out, that don’t always catch attention despite their tremendous importance: “Crying for Freedom.”
Democracies do a superior job of averting disasters, such as famines (Sen). They don’t always have higher growth rates but they have less volatile growth (Rodrik). Controlling volatility matters because an economy can be destroyed faster than it can be built, as the sad example of Zimbabwe most recently shows us. Read the rest of this entry »
A few months ago the world celebrated the fall of the Berlin wall. Reflecting upon transition twenty years after this historically monumental event, yields important lessons about the challenges of establishing democracies and market economies. Neither appears overnight; both require difficult and often unpopular reforms in order to create inclusive and responsive institutions of governance and business.
The outcomes of the systemic transition in Central and Eastern Europe are undoubtedly impressive but vary greatly, and even the most successful countries continue to struggle with corruption, delayed reforms of key economic sectors, and disillusionment and lingering nostalgia among their populations. In order for the region’s democracies to deliver growth and prosperity, their democratic and market institutions must become more representative and inclusive so that a genuine public-private dialogue can lead to concrete reforms. Local civil societies and business communities are crucial agents of this process, providing grassroots input into policymaking and bringing substance to the region’s democratic development.
In his latest article in the Journal of Democracy, Larry Diamond ponders why are there no Arab democracies:
The continuing absence of even a single democratic regime in the Arab world is a striking anomaly—the principal exception to the global- ization of democracy. Why is there no Arab democracy? Indeed, why is it the case that among the sixteen independent Arab states of the Middle East and coastal North Africa, Lebanon is the only one to have ever been a democracy?
Is it culture? Religion? Oil-dependence? Diamond argues that none of these factors matter.
He does point out that economic factors play into the lack of democracies in the region. Although it has nothing to do with economic development levels – they are up to par with other democracies around the world – economic structures do matter Read the rest of this entry »
CIPE often hears from its partner organizations in the field how difficult it can be to get the local business community to support their work monetarily. This is a particular problem for groups that work to bring more people into the business community, focusing on encouraging youth and women to become entrepreneurs. One of CIPE’s partners in Nepal, Samriddhi, The Prosperity Foundation, found a simple and cheap way to start raising money within their local community for their work with youth, while at the same time building a brand for the organization. Read the rest of this entry »
Last month, in partnership with The Citizen Foundation, CIPE office in Pakistan organized a pilot program to train a group of 31 young boys and girls belonging to the lowest strata of society on entrepreneurship. The training was delivered in Urdu and based on previous entrepreneurship programs CIPE has held in Latin America, Eastern Europe, and the Middle East.
It was so astonishing to see the high enthusiasm amongst participants who spent three days developing business ideas, conducting SWOT analysis, developing a marketing strategy, and preparing financial viability plans. For more, take a look at this video:
In 2004, two suicide bombers got on two planes in Russia, bypassing security, and blew up the planes. It cost them roughly $30 in bribes. 90 people died. That’s less than 50 cents per life. This poster, by TI-Russia seeks to get people to understand that corruption is not harmless. Corruption kills.
Posters like these from the United Nations Office on Drugs and Crime are popular in Bhutan, highlighting concrete examples of corruption’s effects on democracy and development.
Bhutan – self-proclaimed “Kingdom of the Thunder Dragon,” one of the world’s newest democracies, and a country fairly high up on the ‘mysterious’ chart. Bhutan has been hidden away from the world nearly since its founding. The establishment of a parliament, the coronation of a new king, and the first-ever elections for the country’s leadership all took place in late 2008. Gradually, Bhutan is becoming more accessible, from an economic perspective, to the world. And yet, even this early in its founding, problems that we see throughout the South Asian region are starting to creep in. Read the rest of this entry »
Ryan Streeter makes two interesting points in his post on successes of making poverty history. First, he notes that despite what everyone may perceive about poverty eradication, over the past several decades we have achieved tremendous successes in reducing absolute poverty around the world. Building on this, he concludes that many of the efforts to “rethink”, “rebuild”, and “redesign” development approaches are probably misguided. Instead, we should pay greater attention to things that have actually worked over the past 40 years and try to replicate them.
Speaking of development approaches that work. Check out remarks by Greg Lebedev on dilemmas of development assistance and why institutional reform, rather than humanitarian assistance, is key to long-term sustainable development and poverty eradication.
Following a democratic transition, newly elected leaders have limited time and space to make good on campaign platforms. In January 2009, Iraqi men and women were elected to 14 provincial councils, following political campaigns in which candidates took to the streets, met with voters in face to face settings and actively sought the votes of their fellow citizens. The newly-elected members of the provincial councils entered a level of government that was weak in relation to a central authority in Baghdad inclined towards maintaining power. In an October 2009 Report to Congress, the Special Inspector General for Iraq Reconstruction described the scope of power for provincial council members as “ambiguous.”
Rather than wait for power’s devolution from Baghdad to provinces, many council members undertook study and analysis of Law 21, which outlines the power of provincial councils. Previously supported in election campaign training by the International Republican Institute (IRI), council members turned again to the Institute for assistance in understanding their new jobs and the scope of their statutory powers. Through 2009, Iraq’s newest class of elected officials lost little time in asserting their rights in local control over budgets, contracts and development projects. Read the rest of this entry »
Corruption is a considerable problem in many countries, undermining the rule of law and impeding broad-based democratic and market development. Afghanistan, unfortunately, is one of the most glaring examples of the pernicious nature of corruption. A recent report by the United Nations Office on Drugs and Crime backs up this perception with precise data. The report found that Afghan citizens pay a total of $2.5 billion a year in bribes, or 23% of Afghanistan’s GDP. This is nearly the same amount generated from Afghanistan’s entire narcotics trade ($2.8 billion a year). Nearly 60% of those surveyed place corruption above security or unemployment as areas of concern to the country. Read the rest of this entry »
Day 2 of our partner conference here in Manila, and Hammad Siddiqui from our Pakistan office is talking about corporate governance of family-owned firms—a big issue here in Asia. Often people think of corporate governance as being just about big publicly traded firms, but good corporate governance can be an enormous boost to the operations of small businesses and to family owned firms of all sizes.
After all, CG is about ethics, disclosure, transparency, accountability, responsibility, etc. And while few would question the need for responsibility and accountability in any firm, when it comes to issues like disclosure and transparency, sometimes the need is less obvious to those in closely held firms. Who are they supposed to be open with? Yet the truth is that unresolved conflicts, lack of delegation, lack of documentation, and lack of inclusive decision-making processes are real weaknesses for family firms. Succession planning is about more than anointing the next in charge; it’s about establishing institutional processes within the firm and about fostering management skills as part of a continuous learning and growth effort. If such skills have not been fostered and exercised prior to a management turnover, the learning curve is steep and treacherous. Read the rest of this entry »
We’ve arrived in Manila for our first-ever partner conference in SE Asia. CIPE partners from all around the region—China, Mongolia, Indonesia, Philippines, Burma—have gathered to share experiences and refine strategies for moving forward in their countries. Already on the first morning, one word that has been used several times by partners to describe their initial efforts is “quixotic.” They feel strongly about the issues they address, and in many cases are making great strides, but many of them undertook their efforts initially as a leap of faith—based on a belief that something had to be done, though it may have seemed like tilting at windmills to do so.
Just on arrival here in the Philippines, it doesn’t take long to see that, even as an active democracy, Philippines nonetheless faces serious challenges. The issues appear front and center in the daily papers and link directly to the issues CIPE addresses: corruption, governance, and access to information, among others. On the first day of our partner meeting, one of the presentations was from Melinda de Jesus, who has worked for years on press freedom issues in the Philippines. Read the rest of this entry »
A common frame of analysis for examining political reform in the Arab world is to group the region’s political actors into three groups: secular democrats, Islamists, and loyal regime supporters. This approach makes it easier to talk about the challenges secular parties face in crafting a space between the regime and popular Islamist groups; it buttresses the profile of leftist activists making great sacrifices to fight for reforms in their own countries; and it offers a convenient lens for explaining the fears more established political actors have of conservative Islamists coming to power in the advent of electoral democracy.
While many of these arguments are well-founded and carry a good share of analytical gravitas, they can also perpetuate rigid political categorization that obscures a deeper understanding of regional political dynamics.
Take Islamists: when various Islamic political groups (moderate, militant, salafist) are lumped into one category of opposition, their differences become erased and they lose their agency as potential actors for reform. What happens in the case of Morocco where moderate Islamists comprise the only true democratic party in parliament and “secular democrats” have all but vanished? Read the rest of this entry »
The Hawkamah Institute for Corporate Governance, Standard & Poor’s, and the Credit Rating and Information Services of India Ltd recently launched its Environment, Social and Governance (ESG) index initiative, the first of its kind in the Middle East & North Africa region. The International Finance Corporation (IFC) is helping develop the index, which aims to encourage responsible and sustainable investment practices by measuring the environmental, social and corporate governance performance of hundreds of listed companies in the region. It aims to help about 600 listed companies in 11 countries to better understand environmentally and socially responsible investment practices, and the importance of implementing sound corporate governance.
The index will cover the United Arab Emirates, Saudi Arabia, Qatar, Bahrain, Oman, Kuwait, Jordan, Egypt, Morocco, and Tunisia. The project also intends to strengthen and promote environmentally-sustainable and socially-responsible businesses, which will create greater awareness and adoption of ESG practices by companies as well as increase available financing options. Hawkamah noted that financial performance indicators have traditionally marked investment decisions, while the index aims to provide the market and investors with a tool focusing on non-financial indicators that are fundamental in assessing the sustainability of a company’s future performance. The IFC added that the absences of credible and standardized data about business practices relating to social and environmental concerns is a key barrier limiting the flow of socially-responsible investing funds to the region.
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In his latest article in the Journal of Democracy, Larry Diamond ponders why are there no Arab democracies:
