Ali Salman is an economics consultant and managing partner of Development Pool, and has worked on several projects with CIPE-DC and CIPE Pakistan. He can be contacted at ali.salman@developmentpool.org

Trusting small enterprises and adapting laws to reflect social contracts for business transactions holds the answer to formalizing the informal sector; levying more taxes will only harm that cause.

One of the key policy objectives associated with the levy of a reformed general sales tax in Pakistan is to expand the tax net, or in other words to reduce the informal economy. The bulk of Pakistan’s economy is underground, or ‘extralegal’. The accounts are multiple, but most would identify the size of the extralegal economy within 30 to 50 percent of Pakistan’s economy or roughly 51 billion dollars in total economic activity. Read the rest of this entry »

(Photo: Flickr user Watchsmart)

If you’ve ever been to Casablanca, you may have noticed there’s a dearth of green spaces. Art deco buildings blend harmoniously with the roar of mopeds and red petit taxies, yet parks seem almost nonexistent. It’s rumored that Morocco’s longtime Interior Minister, Driss Basri, sold land designated for parks at discounted rates to his close friends. Basri, known as the vice-king, was also famous for diverting large sums from the state’s budget for the development of his hometown just south of Casablanca, Settat. Was Basri corrupt? He sure was. Is using one’s position of authority to reward those closest to you also corruption? That depends on who you ask. Read the rest of this entry »

Philadelphia Eagles starting quarterback Michael Vick (#7) running the ball in a victory against the Washington Redskins earlier this NFL season. (Photo: Nick Wass/AP via bleedinggreennation.com)

The Michael Vick story is not just about football. From sporting a jumpsuit as inmate number 33765-183 in Leavenworth Penitentiary, to being hailed as a contender for Most Valuable Player (MVP) in his first season back as an NFL starting quarterback, the rebirth of Michael Vick in 2010 is one of the most compelling stories that has captured the attention of fans and detractors alike.

But what makes the Michael Vick story so fascinating is not a triumph of greed over principle, or mercy over horror; it’s embodied in President Obama’s call to the Philadelphia Eagles praising owner Jeffrey Lurie for hiring Vick and giving him a second chance.  Obama’s message to Lurie didn’t just remind us that those who have made mistakes can rehabilitate themselves through hard work, discipline and other virtues—it had greater global implications for what a market economy stands for: second chances. Read the rest of this entry »

Over the past few decades, women’s empowerment has grown dramatically as a focus for economic and democratic development.  The importance of women’s participation in the social, political, and economic atmospheres has gained increasing recognition as an integral unit that helps drive development.

Even though women constitute half of the world’s consumers, business opportunities and economic development for men and women were not created equal.  Sometimes, laws or customs restrict women’s access to property rights and the skill-building resources necessary to actively participate in politics or business.  CIPE’s work in women’s participation and entrepreneurship provides women with the tools and training programs that will help them take part in successful economic development. On the CIPE Development Blog, women are active participants and frequent subjects of success and development (at least one women’s chamber of commerce has been both), demonstrating that innovation and gender equality will continue to drive global economic and democratic development: Read the rest of this entry »

Entrepreneurship has had a great 2010 to maintain the rise of interest in the topic over the past two years. Google Trends, for example, shows a sharp increase in searches that include all or part of the word ‘entrepreneur‘ beginning in January 2009.

Entrepreneurs, and the businesses they create and grow, are important to democracy because by distributing economic power they also help distribute political power. When societies are not economically dependent on governments or large enterprises cozy with  government officials, they are more likely to vote for leaders that uphold democracy and the rule of law rather than leaders who buy votes or make all sorts of false promises. New jobs and businesses are also sources for tax revenues that can wean governments off of foreign aid. For these and other reasons, entrepreneurship is one of the most written-about topics on the CIPE Development Blog. Here are some enterpreneurship highlights from 2010′s posts: Read the rest of this entry »

2010 was undoubtedly a landmark year for Africa, as 17 countries in the sub-Saharan region celebrated 50 years of independence. It has been an eventful 50 years, indeed; in terms of governance and leadership, these 17 countries have seen the pendulum’s full swing, from coups and authoritarianism to elections and democratic victories; from socialism to market-based economies. However, democratic consolidation has yet to fully occur in any of these golden-year independent nations, and in some cases, democratic backsliding is a real threat. Read the rest of this entry »

Corruption isn’t a new issue for business communities around the world. What’s new is increasing discussion about how it might be stopped.

As one of many signs of growing debate, in September 2010 the Wall Street Journal launched its Corruption Currents blog, providing news, analysis, and commentary from the ever-changing world of corporate corruption. On the CIPE Development Blog, corruption and its discontents have also been turning up the volume. Here are a few highlights from the past year’s posts on corruption: Read the rest of this entry »

A man casts his vote on October 31, 2010, at a polling station in Abidjan, Cote d’Ivoire. After recent elections disputes, ECOWAS presented an ultimatum to encourage incumbent president Gbabgo to relinquish power or face military removal. (Issouf Sanogo/AFP/Getty Images)

A delegation of West African leaders confronted incumbent Côte d’Ivoire president Laurent Gbabgo yesterday, threatening military removal if he does not step down from power. A month after election disputes, Gbabgo refuses to transfer presidential power to Alassane Ouattara, the candidate recognized by much of the international community as the election’s victor. The election commission declared Ouattara as winner of the popular vote, but because of election disputes, the Constitutional Council granted presidential victory to Gbabgo. Read the rest of this entry »

If you’re working in global development and you have just been tasked with increasing toilet usage and improving personal hygiene in East or Central African slums, your new best friend might be one who is deeply motivated to advance your cause: the local toilet paper company.

Family-owned Chandaria Industries Limited (CIL) is the leading tissue, paper, and hygiene products manufacturer in East and Central Africa, according to the African Business Review. Besides fronting some of the cost of water and sewage infrastructure in the Ruaraka neighborhood of Nairobi where CIL’s headquarters is located, Chandaria Group companies have also fought for provision of decent water and sewage infrastructure for all, with an eye toward market expansion for CIL-produced goods, according to the company website. Read the rest of this entry »

Almas Kusherbayev is a Kazakh journalist working in Central Asia.

The debate on whether a market economy can exist without democracy is ongoing, and many think that at least two countries in the world are good examples of how the former can exist without the latter: China and Singapore. The question is whether such systems can be models for development without democracy in other countries. But a closer look at the nature of China’s and Singapore’s economic transformation highlights some important political and social factors as well that hardly make their models universal. Read the rest of this entry »

The holiday season is once again upon us. Ever since my childhood the season has been marked by several classic films. Once I began to travel I understood that it is common around the world to spend some of the holidays with old classic holiday favorites. In the United States, perhaps the most famous holiday film is It’s A Wonderful Life. The film offers food for thought on morality, faith, community, and small business. Read the rest of this entry »

While discussions of informal economies have become a prominent part of today’s debates in international development, perspectives from private sector associations are not pervasive. As conglomerates of formal businesses, however, those groups can provide a unique perspective on the topic.

Youths’ perceptions of informal economies also provide enlightening insight on the future of informal business. Through CIPE’s ChamberL.I.N.K.S. program, CIPE staff recently had the opportunity to sit down with young leaders from private sector associations around the world. While we meant to speak broadly about entrepreneurship in the participants’ home countries of Bangladesh, Brazil, Russia, Sierra Leone, Sri Lanka, and Tanzania, one topic in particular kept reappearing in our conversation: informal sector businesses (those that provide lawful goods and services without legal registration or license.) Read the rest of this entry »

Imagine you’re a policymaker in a low-income country seeking to attract more foreign direct investment (FDI).

Perhaps you’ll target run-of-the-mill investment bankers looking for some emerging markets action to boost their performance for the year and get that bonus they’ve been craving. Or there might be a major international IT firm or a manufacturing conglomerate looking to break into a new market or tap into a new supply chain. You might even seek out impact investors looking for pro-poor business models with explicit social goals as well as economic.

No matter what kind of investor you want to attract, there are many institutional factors that affect all foreign direct investment just the same, and many of these factors are now captured in the World Bank’s new Investing Across Borders (IAB) indicators. Read the rest of this entry »

CIPE Pakistan office director Moin Fudda, left, speaking at the forum discussion co-hosted with the Pakistan chapter of the Association of Chartered and Certified Accountants. (Photo: CIPE)

Generally, the media focuses on corruption and bribery scandals related to government, public corporations and large private companies. Not many consider that corruption is also a large burden on Small and Medium Enterprises (SMEs). Often with their limited resources, when survival remains the key objective, most SMEs get sucked in to the spiral of corruption and bribery. One of the key reasons for getting into this is their inability to keep their financial records in order. Read the rest of this entry »