Secretary Madeleine Albright

Remarks
Madeleine K. Albright
Announcing the Creation of the Commission on Legal Empowerment of the Poor.
September 13, 2005

I am pleased to join Hernando de Soto in announcing the creation of the Commission on Legal Empowerment of the Poor.

Mr. de Soto is someone whose ideas and writings I have long admired.

The commission is designed to test and lay the groundwork for implementing some of his concepts.

Ours is a different approach to fighting poverty.

We put it forward not as a substitute but as a complement to other efforts.

It is intended to help the world make further progress toward the Millennium Development Goals, and in so doing to make a difference in the lives of hundreds of millions of people.

Our focus will be on the link between poverty and the lack of legal protections for the disadvantaged.

Our purpose will be to help extend the rule of law to the world’s three billion poor; to give them a larger economic stake by including them in the legal protections every modern society should offer.

More than two-thirds of the world’s people do not enjoy those protections today, including the right to own and sell property.

Many of these people do have assets in the form of land, housing and livestock, but they are not able to make the most of them because they do not have legal title.

When it comes to the rule of law, ancient Rome was more advanced than many of our societies today.

In some countries, ninety percent of property is owned outside the law.

What does this mean?

It means that people are vulnerable to exploitation and theft.

And it means they are unable to do much to improve their own economic and social conditions.

This hurts them and their societies, for it leaves their governments less able to provide basic services in the form of schools and health care, power and water.

The result is a social fabric that remains unwoven, leading in extreme cases to instability and strife.

If we can make property rights accessible to all, we can also help the poor to use those rights to obtain credit and make investments, start businesses and build savings.

One reason I like the approach is that it defies any particular ideological label.

It is a sort of cross between “the ownership society” and “power to the people.”

We are convinced this is a good strategy; a novel strategy; and I am delighted that we have been able to attract such an outstanding array of experts to serve on the commission.

I want to emphasize that this is an initiative aimed at helping people, not at imposing upon anyone a particular economic view.

Though eager for support and anxious to test our ideas, we are also open to the views of others.

Our interest is in results.

With that in mind, I look forward to a very productive and meaningful thirty months.

President Mkapa

Statement By The President Of The United Republic Of Tanzania, His Excellency Benjamin William Mkapa, At The Launch Of the  Commission On Legal Empowerment Of The Poor, United Nations, New York, 13th September 2005

Co-Chairs of the Commission on the Legal Empowerment of the Poor, Fellow Commission Members, Distinguished Guests, Ladies and Gentlemen:

It is a great pleasure for me to be here, on the day we launch what I believe will turn out to be a major breakthrough in the way we understand poverty, and in the global search for strategies to win the war against it. For too long, haughty in our elitist learning and drowsed in our political leaning, we have failed to look at poverty with the eyes of the poor. We have not sought sufficiently to understand the obstacles to development from the insight of those who have travelled, and are traversing daily the obstacle-strewn path to fight exclusion from the modern, formal, legal economy.

That is why I am so glad and grateful to be part of this team to champion the cause of the legal empowerment of the poor through the formalisation of their properties and businesses, and to facilitate the will of the poor to pull themselves out of poverty by their bootstraps.

We meet on the fringes of the High Level Plenary Meetings of the United Nations General Assembly convened to review progress in the implementation of the Millennium Development Goals (MDGs). Everyone agrees that enough progress has not been made in overcoming global poverty. We will make statements calling for increased commitment and support to the attainment of MDGs. But, for too long we have looked at the war on poverty from the wrong end, with a top-bottom perspective. We have to understand that the poor too have ideas on self-development; that they too do not want to be perpetual objects of charity; that they want development in dignity, using the human, physical and natural resources they possess; and that they want and deserve help to be able to do so.
The Commission we are launching today should help us understand and approach the war on poverty for a bottom-up perspective, by empowering the poor with the legal tools and means to self-develop in dignity.

Let me tell you of Tanzania’s experience. For over 10 years now we have been carrying out far-reaching reforms that have seen inflation drop from over 30 percent to 4 percent; and economic growth from about 2 percent to 6.7 percent last year. The macro-economic situation and statistics are admirable; but impact on poverty is slower that we could have expected.

One reason, in my view, is that while we create market economies, we have not made enough effort to empower our people to operate and benefit in a market economy. We have systems and institutions for inclusion they do not understand, or which are too cumbersome, too costly in time and money, and too complex for them. So they stay outside and design their own ways of survival. Our systems and institutions have become not facilitative, but obstructionist and exclusionist. As a result, too much of economic activities in my country occur outside the formal, legal framework.
Last year, with the financial support of the Norwegian government, we engaged the services of the Institute for Liberty and Development (ILD) to conduct a diagnostic study of the informal, extra legal sector in Tanzania to find out its actual size and content, and to flash out the obstacles that stand in the way of our poor people when they want to make the transition from informality to formality, from extra-legality to legality, from exclusion to inclusion and participation.

The findings from the diagnostic study are truly revealing. We now know that:

• Because most Tanzanians hold their property outside the law, they are considered poor. But the study has established that the extra-legal economy in Tanzania holds assets worth USD 29 billion, which is much more than Tanzania received in Foreign Direct Investment, or aid and loans for many years. In other words, what the poor of Tanzania have already, if made liquid, is much more than what the outside world can ever give them.
  
  
• 98 percent of all businesses operate outside the legal system.
  
  
• 89 percent of all properties are held outside the legal system.
  
  
• Tanzanians in the extra-legal economy have created their own system of documentation that allows them to govern their activities outside the legal system. They have created an abstract order to govern the way they relate to each other. The diagnostic study found thousands and thousands of extra-legal documents governing property relations and transfer in the informal sector. In other words, the people have found the government unable to design systems they can relate to and work in, and have created their own.

Ladies and Gentlemen:
This study has shown us the disconnect between genuine government efforts in terms of economic policies and economic reform on the one hand, and what the vast majority of people actually do on the ground. We have a property and business legal environment most of the people do not understand, cannot access and cannot relate to, and which precludes the use of their assets to leverage their participation in a modern economy.

And because they cannot access the existing system, they have created their own archetypes of property relations, including for things like adjudication, documentation, registration, fungibility, collateral and testament. They also have created archetypes of business organisations and expanded markets outside the legal sector. The real challenge is for governments in countries like Tanzania to use these archetypes as basis for a new system the people can relate to and access, and which can be standardized and used to bring down the barriers that stifle the entrepreneurship of our people, that exclude them from participating in the markets we seek to create.

Ladies and Gentlemen:
I am here to provide my full support for the High Level Commission on the Legal Empowerment of the Poor. With the legal empowerment of the poor, their resources, ingenuity and entrepreneurship can be released, and only then can they participate in the market economies of their countries. We need systems that regulate and facilitate, not those that exclude and marginalise people. Our people must now be legally empowered to play their rightful role in the market economies we are trying to build.

You have my full commitment and support. I thank you for your kind attention.

Kemal Derviş

Remarks by Kemal Dervis,
Administrator of the United Nations Development Programme
Given on the Occasion of the Launch of the Commission on Legal Empowerment of the Poor, 13 September 2005, United Nations, New York

Excellencies,
Madame Fréchette,
Dear colleagues and friends,

It really is a great pleasure to be here at the beginning of this week, where, despite the difficulties and problems, logistical and political, we are all coming together. I think it will be a very great week for development, for the Millennium Development Goals, and for the poor and vulnerable in the world.

It gives me great pleasure to participate in this historic event, the launch of the Commission on Legal Empowerment of the Poor. Thank you all for being here.

Let me single out a few thanks, although there are many more: The Government of Norway and our launch partners, which include Denmark, Canada, Egypt, Finland, Guatemala, Iceland, Sweden, the UK, as well as many other supportive governments. I thank President Mkapa for his leadership of this issue in Tanzania and globally, and also for his wonderful speech. I would like to thank the co-chairs, Madeleine Albright and Hernando de Soto, for really taking on this tough issue. I thank all the Commissioners for their commitment, not least Ernesto Zedillo and Fernando Cardoso, former Heads of State and leaders of the UN Commission on the Private Sector and Development and the Secretary-General’s Panel on United Nations/Civil Society Relations, respectively, as well as Mary Robinson, former President of Ireland and former High Commissioner for Human Rights, Shirin Ebadi, winner of the 2003 Nobel Peace Prize, and many others who are joining forces here this evening.

Let me say just a few words on the Millennium Development Goals (MDGs), which is the broader context in which this event takes place. In the year 2000 when the UN Secretary-General and those who supported him launched the Millennium Development Goals, I do not think we could have expected there would be so much political and civil society support for this. The values reflected in the MDGs have really caught on. While nothing is perfect and one can quarrel with one target or another, or with exact definitions, I think overall, it has helped us mobilize a huge amount of political energy worldwide behind the objective of development and behind the fight against poverty. So in that sense I am glad that we are reaffirming our commitment to the Millennium Development Goals, and that we are going to work within that concrete framework, to measure progress and move towards objectives which include halving the number of people living in extreme poverty and who suffer from hunger by 2015.

There is of course much debate on the issue of whether the MDGs are feasible or not. Let me just say that broadly speaking, I believe we can make it. Certainly on the resource side, while increased contributions are needed, they are feasible. I speak as a former Minister of Finance and know how difficult it is to mobilize resources. But the figures, if everybody does their bit, are feasible. And in terms of technological know-how, and bringing to bear science and technology on the various challenges that exist, again, I think we can make it. The biggest challenge we face is in the institutional context, in the political context, and in the context of human behaviour —not the financial context. The financial task and the technological task are the easiest part. The behavioural and the institutional part I think are the most difficult. And that is why, in a sense, this Commission and the whole work on the legal system is so very important, and why the Commission is needed. It is going to grapple with one of the biggest challenges of our time: how can we truly unleash the creative forces, the entrepreneurial ingenuity which is just as present among the poor as among the well-to-do? How can we build the required legal and institutional systems that can make this happen?

It is going to be a tough task and the issues are very difficult and interrelated. If one takes a purely legal approach, it is not going to be sufficient, although the legal systems and adequate legal infrastructure is sorely needed. A purely economic approach is not sufficient either. The informal sector has tremendous capacities—I know it from my country. There is a tremendous amount of productive energy and initiative in the informal sector, but it also has problems. It is not all rosy. Sometimes there are criminal elements in there and being outside of the law creates all the wrong kinds of incentives. So when we talk of mobilizing all of this, we know that we will face some very tough challenges. Sometimes power and vested interests exploit the informality to build a separate, non-democratic power base in many of these economies. Indeed, sometimes this power base is quite global. A friend of mine just finished a book on the extralegal economy world-wide, and next to the very positive energies and initiatives, there are also a lot of things which one has to control.

I think the other point that I would like to make is that what we have realized over the last two or three decades of experience is that the driving force in development definitely has to be the private sector, and private initiatives, from very small enterprises to large multinational corporations. I think people from all sides of the political spectrum now agree that the private sector has to be the driving force. I do believe that in the UN we have to work much more with the private sector in its various incarnations, and try to connect with all the energy and resources that are available in the private sector. At the same time, I also think we have also learned that it is not a question of private sector versus government. It is not an alternative. I think that development requires a good, strong private sector, with good government and good governance. It is not like we used to think thirty or forty years ago, that there are these two alternatives: markets versus planning, private sector versus government. In fact, it is the two coming together that create the strong development prospects that we are looking for.

I am extremely pleased that UNDP can be associated with this initiative. It directly builds on and advances the agenda of the UNDP sponsored Commission on Private Sector Development, which was chaired by the Prime Minister of Canada, Paul Martin, and the former President of Mexico, Ernesto Zedillo. The Commission on Legal Empowerment of the Poor is of course independent, and the conclusions you arrive at are of course up to you, the Commissioners. I hope you will offer us compelling arguments. We in UNDP and other actors in development, especially governments themselves, in close partnership with civil society, must be responsible for taking the agenda forward from there.

UNDP offers you its networks of Country Offices in 140 countries as a partner in exploring opportunities for advancing legal empowerment. We offer you accumulated experience and the enthusiasm of our staff. Perhaps most importantly, we will work with our friends and colleagues in all the relevant multilateral agencies to ensure that you get the best that the United Nations has to offer in terms of support, dialogue, intellectual exchange and the testing of ideas. It is just my third week on the job, and I realize, how decentralized in many ways the United Nations system is. I think that is good in a way, because it does create initiative and it creates a lot of enthusiasm at the grassroots level of our organization.
But I also strongly believe that we have to come together more strongly within the UN family to really pull things together, as well as work with other major actors such as the World Bank and the multilateral development banks and other international institutions. We have to make sure that the resources we have—which are quite considerable, when you add them all up, from the humanitarian to the economic and social side—are deployed in the most effective possible way in support of the Millennium Development Goals and the development of the people we try to serve.

This initiative is clearly worthy of strong support and I think it has that, not least, thanks to the initiative and the work and commitment of Hernando de Soto and Madeleine Albright. The governments of the world are ready and prepared to undertake the complex challenge of reform for the benefit of the poor and society at large.

I should also especially mention Minister Hilde Johnson of Norway who made the opening remarks and who I know is one of the driving forces behind this initiative. I know this is one of your projects that you have been pursuing for a long time, and I look forward to continuing to work with you.

The opportunity is open. Let us take the best advantage of it together.

Many thanks.

Secretary Mona Brother

Remarks
Ambassador Mona Elisabeth Brother, Norway
At the Women's Economic Empowerment as Smart Economics Conference in Berlin, Germany 

It is a known fact to this audience that if you exclude women from economic structures, you also exclude more than 50 per cent of the talent, the driving force, the organisational power and the entrepreneurship of humankind. Still, statistics show that women, who produce 90 per cent of the world’s food, own only 2 per cent of the world’s land. And, women are three times as likely as men to work in the informal economy.

So, the empowerment of women has, in my view, first and foremost to do with formalisation and access to the rule of the law.

How can equal legal status for women, including the right to own and inherit property, and to hold joint land titles, best be enforced?

In addition to presenting Norway's viewpoints on today's agenda, I will also mention the work of the Commission on Legal Empowerment  of the Poor, which is supported by Norway  and the number of other donor countries.  

The Commission was set up in 2005, and will deliver its report in January 2008. One important item on its agenda, stressed by the donors, is to look at gender sensitive factors in poor people’s access to property rights.

This Commission has done, what so many speakers at this conference have mentioned as a prerequisite within the field; making an inventory on baselines, and formalisation programs, counting success stories, but also some “worst cases” experiences. The Commission will deliver its results in January 2008. Must important, the Commission will deliver a Tool Kit for governments; a menu, or buffet table, on how countries can go about in ensuring the access to the law for poor people; have to make easy and accessible programs and methods for property registration; and, to show how property rights belong to what we call “the bundle of rights”, seen in the context of access to legal mechanisms, arbitration, and security of jobs, amongst others. It is, in short, to minimize barriers, and link the informal-formal sector standards to secure protection of the poor.

Empowerment has at least two important dimensions. It is a complex concept, and the term can be applied to:

1) The restoration of individuals’ sense of their own value and their ability to deal with life’s problems (the individual approach), and

2) Changes to power structures to develop a society that is inclusive, protective and ensures equitable distribution (the collective approach).

Both dimensions are included in the Commission’s work.

The important question is how can the individual approach spur the collective dimension of empowerment? How can governments be persuaded to adopt gender sensitive agendas that ensure access to formal structures and enforce women’s rights and protection?

Formal structures and access to property rights not only secure income, but also give entitlement to other benefits. 

There is a need for a closer analysis of power relations. Mainstreaming a gender perspective into economics will not in itself open up markets for women. Systems of power, agents of change and impediments to change must be considered. Who are the strategic partners in the struggle for power in the economic sphere, and who are in a position to impede empowerment?

What can donors do?

Norway has been at the forefront of efforts to bring legal empowerment and the fight against poverty onto the global agenda. We have therefore actively supported the new Commission, and intend to promote the dissemination of its results and the mainstreaming of legal empowerment into both regional and national programmes.

Pilot programmes on the legal empowerment of women and the securing of property rights could play a vital role in the follow-up efforts. It is extremely important that formalisation programmes take women’s access to property rights, including collective and users’ rights, into consideration. A solely individual-based approach to property rights could easily cement unfair structures that favour the rights of men. It could also create new obstacles that prevent women from maintaining tradition-based rights.

Donors could cooperate on the provision of easy access to legal aid for women and cheap arbitration mechanisms for the poor at the local level. This might be of particular importance in post-conflict situations, mentioned here today.

Job security in the wider sense has a different meaning for women than for men. We have seen that women who enter into the organised labour market in manufacturing industries in Asia experience greater personal insecurity;both in the work place itself and on their way to work. Donors should be sensitive to this fact in their investment incentives, and should encourage employers to safeguard the female work force to a far greater extent than today.

Vocational training efforts that aim to raise women from the lowest level jobs to more skilled positions should be supported. When women move up the ladder in businesses, their pay levels, security and dignity improve dramatically. This is real empowerment. 
This seminar has been touching upon the importance of access to credit, that relates closely to property rights. We should not always stick to micro credit as a tool. In the banking systems, there is a wide gap between the micro credit level, and the multinational financing institutions. In between, there is a level that is as important as the other two. That is the banks for saving accounts (Sparebank), and Housing banks. I hope the Commission will deliver tools in that regard. And; ensuring access to cash is part of the collective approach to empowerment; it is the minimum requirement of distribution policies in favour of the poorest of the poor.
With funding from Norad (the Norwegian Agency for Development cooperation), Care is supporting efforts to strengthen the economic empowerment of women in eight African countries, largely by establishing, and providing training for, self-run savings and credit groups that provide poor women with easy and immediate access to financial services, and to a certain extent insurance. These groups enable women to start businesses, ensure more continuity of current business activities, or even out seasonal fluctuations in their economies, which are often closely linked to the agricultural cycle.

Norway has also through some years been supporting simple and easy access programs in titling. One such program was mentioned here yesterday, from Vietnam, where the titling mechanism was set up at local levels and where the title itself for the first time had a line to put the woman in the household’s name. Other titling programs have been effectuated in Indonesia, in Thailand, and in the new economies in Eastern Europe. These programs have mainly two parts; one is to register through  mapping and the other, to set up registers with easy, cheap and fast  access.

So, as you see, donors can share success stories, but should always be sensitive to the fact that change is driven from within society; donors are merely facilitators.

Finally, donors should be active partners in efforts by other multilateral organisations and international financial institutions to empower women. It may be that access to law is most easily ensured by training women in entrepreneurship and labour rights. In any case, we ourselves must make sure that the empowerment of women is in focus when we are drawing up our yearly programmes and managing our funds. We have only ourselves to blame if the issue is forgotten or overseen.

The necessary political will at governmental level is vital to achieve all these ends. This is why the Commission for the Legal Empowerment of the Poor will present its results to governments in the form of a tool kit. This is intended to help governments both implement reform and take concrete action on poverty through ensuring the rule of law and easy and secure access to property rights in the wide sense. It is my hope that leaders from both donor countries and developing countries will include the empowerment of women in their overall strategies for development.

The Commission I talked about will need to find a home for follow-up; a partner for both developing countries as well as donors where programs are defined to the ends mentioned above. It is my hope that both the World Bank, UNHabitat and the UNDP can be such partners after January 2008. Then the vision is that the cork of the Commission will have changed conceptual thinking, and developed the needed tools. Action within the field of legalisation and formalisation will signify a new and bottom-up way of development.

 I would like the focus of this meeting to be on the link between legal empowerment and economic empowerment. In my mind, that is what it is all about.

Thank you for your attention.