Hernando de Soto, ILD’s founder, affirmed that they have received more than 44 requests from reform-minded governments from all over the world seeking to learn from Peru’s positive experience on protecting property rights. Peru’s policy reform, in fact, put Peru ahead of countries like Canada, the UK, and Japan on the Registering Property Indicator of the 2016 Doing Business report.
Latin America, however, is still torn ideologically between defenders of free markets and those who still favor over-regulation. But some governments are seeking to strengthen property rights. Brazil, which has generally demonstrated strong growth in the last decade, has room for improvement. The idea that rights serve a social function was first introduced into Brazilian legal culture in the early 20th century. Thus, Brazilian law punishes owners if their property does not serve its “social function,” thereby weakening the importance and value of private property.
Owners, for instance, are obligated to make their property productive, according to the state’s criteria, that is. In Brazil, state intervention clearly has a negative impact on the economy, and the lack of legal security frequently scares investors away.
As Venezuela’s economic crisis worsens, the newly elected National Assembly (dominated by the opposition) introduced a bill in February that grants property deeds to more than 593,000 holding owners — and now full owners — who benefited from one of the most popular policies of Hugo Chavez’s government: Misión Vivienda, a government program that gave houses (but not deeds) to poor Venezuelans.
The new objective is to democratize existing property, and provide house owners with access to the market by giving them, for example, the legal instruments to use their property as collateral for a bank credit and start a business.
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