Egyptian President Abdel Fattah al-Sisi’s government is counting on a new multi-billion dollar Suez Canal project to help overcome what has been described as Egypt’s worst economic crisis since the 1930s, with high unemployment — 13.4 percent — and 45 percent of the population living below the international poverty line of $2 per day. Yet, what’s more important than the new Suez Canal’s objective to stimulate the economy and create jobs is who made it financially possible to carry out such an ambitious project and what that could mean for Egypt.
In eight days, Egyptians invested 64 billion EGP (about $9 billion) in the new Suez Canal project — and 82 percent of that investment came from individuals versus just 18 percent from institutions. The influx of investments introduced 27 billion EGP (about $3.8 billion) into the banking system, which is especially notable given that only one in ten Egyptians has a bank account. The overwhelming turnout of individual, cash-heavy investors from an underbanked population points to Egypt’s strong cash economy, which in turn begs the questions: how much more money is hiding under mattresses and why have these assets remained unused?
The United Nations Universal Declaration of Human Rights states that “Everyone has the right to own property [and] no one shall be arbitrarily deprived of his property.” In Burma, a country in the early stages of its emergence from a half century of military rule and central economic planning, property rights violations could threaten democracy itself.
Burma lacks many institutions necessary for a market-oriented democracy, such as a reliable court system, dependable electricity, and accessible financial services. The country’s physical infrastructure is also woefully inadequate. Paramount among these issues is rampant corruption and terrible public governance – issues that manifest in the “land-grabbing epidemic” which is sparking protest and civic unrest.
Read the rest of this article at the Thomson Reuters blog.
Recent developments concerning property rights violations and popular riots in Venezuela remind us that democratic and economic development is not always a gradual forward-looking process but instead is characterized by periods of progress as well as setbacks. Separation of powers, property rights, the rule of law, the respect of human rights and the rights of minorities are essential components of a functioning democratic and free market system.
Reflecting on the challenging situation in Venezuela and the business community’s experience of threats to private property rights, Jorge Roig, President of the Venezuelan Federation of Chambers of Commerce FEDECAMARAS, was invited by the Free Enterprise and Democracy Network to share his views in the latest Economic Reform Feature Service article.
By David Owiro. This post originally appeared on IEA Kenya’s blog.
If you have ever taken a walk around the major towns in Kenya you will come across warning notices and signboards announcing to the world that “this plot/land is not for sale” or that “this property is not for sale.” Also, if you are a keen reader of the daily newspapers you will come across, in the back pages, notices announcing “caveat emptor or buyer beware” on some parcels of land. These are often put up by individuals seeking to enforce their property rights by deterring members of the public who are likely to be defrauded by unscrupulous groups or individuals.
And now, the National Land Commission, which is the body mandated by the constitution of Kenya to hold public land in trust, has also began placing adverts warning members of the public against buying land without carrying out background searches or relying on certificates of titles.
The reason all this is happening is that people have taken advantage of the previously weak property rights regime that allowed for exploitation and manipulation of official land and property records in order to defraud unsuspecting members of the public.
New “malls” in downtown Nairobi offer opportunities for small business. But are their property rights being respected?
By David Owiro
Over the past few years, residents of Nairobi’s central business district (CDB) have noticed an interesting phenomenon. The previously large commercial premises on the main streets and avenues have been subdivided, converting them to mall-type premises that allow for subletting to many micro, small, and medium businesses. This phenomenon is, however, not unique to the CBD. This model, I’m made to understand, was borrowed from India, where mostly fabric traders sell their wares under one roof. The concept has spread to Eastleigh estate in Nairobi and can also be observed in some of the major towns in Kenya.
The Institute of Economic Affairs (IEA) carried out a qualitative survey of small businesses who operate in such mall-type commercial premises in Nairobi’s CBD to determine the impact of the property rights regime on their businesses, and the findings point to a deeper policy problem. In spite of the recent property rights reforms brought about by the new constitution, the study found poor enforcement of property rights, agency coordination problems, and low awareness levels among small businesses, leading to exploitation, abuse of tenant rights, and a hostile business environment.
Constitutions can play an important role in protecting economic liberties, in addition to political liberties. As the state’s foundational legal document, the constitution can provide the essential framework for establishing commercial freedom and promoting the development of the private sector. For example, CIPE partner the Syrian Economic Forum (SEF) is developing proposals for the constitutional protection of private enterprise during a future transition period in Syria.
Different countries have taken a variety of approaches in tailoring their constitutions accordingly, which should be examined in determining how Syria’s next constitution will promote and protect private enterprise.
As we celebrate the Global Entrepreneurship Week, we are reminded time and again that making entrepreneurship work takes an entire ecosystem of supporting factors. CIPE’s recent report, “Creating the Environment for Entrepreneurial Success,” highlighted the complexities involved and focused on many elements needed for entrepreneurs to succeed. Property rights and institutions that create healthy property markets are among such crucial elements of building vibrant entrepreneurship ecosystems.
Property rights are key building blocks of modern market economies. They are also a fundamental human right, enshrined in Article 17 of the United Nations Universal Declaration of Human Rights, which states that:
- (1) Everyone has the right to own property alone as well as in association with others.
- (2) No one shall be arbitrarily deprived of his property.
These simple statements seem self-evident. Yet, it takes a multitude of intertwined and interacting laws, rules, and institutions to ensure that property rights are accessible to all members of the society and adequately protected so that they can become equal stakeholders in their country’s future.
The International Property Markets Scorecard, a tool jointly developed by the Center for International Private Enterprise (CIPE) and the International Real Property Foundation (IRPF), takes such a holistic view of property rights in their broader context. The Scorecard maps the institutional components of property markets and evaluates their effectiveness, providing a methodology to investigate the six core elements necessary for sustainable property market development:
- property rights laws and enforcement,
- access to credit,
- efficiency of governance,
- rational dispute resolution,
- financial transparency,
- appropriate regulations.
The Scorecard is a tool for in-country reformers, international policy advisors, and market analysts as it provides comprehensive snapshots of market conditions, identifying key areas for reform as well as market risks. CIPE and IRPF have been using this methodology to conduct research and support local partners’ advocacy efforts over the last few years in countries ranging from Armenia to the Philippines. Today we finally brought all the findings together under the newly launched International Property Markets Scorecard website, www.propertymarketsscorecard.com.