06 March 2007

Strong Property Rights Link to Economic Well-Being, Report Says

New index ranks countries on property rights quality, protections

Washington -- Countries with strong, well-protected property rights are more likely to thrive economically than those with weak property protections, according to a new international report.

A positive correlation between a country's prosperity and the quality and enforcement of its laws in such areas as land titles, copyrights and patents was established by the first International Property Rights Index (IPRI), launched March 6 in Washington by the Property Rights Alliance (PRA) and its 37 global partners.

The PRA is a special project of the Americans for Tax Reform, a lobbying group.

Scott LaGanga, PRA executive director, said in a news release the report proves wrong those who claim that strict property protections prevent developing countries from unlocking their growth potential.

“Well-structured private property rights allow individuals and firms to feel secure and provide them with an incentive to innovate and produce,” he said.

IPRI ranked 70 countries on 11 factors related to physical property rights, intellectual property (IP) rights and legal and political environments.

Advanced industrialized economies from Western Europe received the highest ranking, with Norway, the Netherlands and Denmark as the top three. Nations from Africa, Latin America and Asia ranked lowest, with Ethiopia, Bolivia and Bangladesh at the bottom.

The report concluded that better-performing countries have, on average, a gross domestic product per capita that is more than eight times higher than that of the worst-performing countries.

European parliamentarian Syed Kamall, who participated in a panel on the report, said the index can help countries pinpoint problems related to property rights. Kamall is a member of the European Parliament representing the United Kingdom.

Another panelist, Chris Israel, U.S. coordinator for intellectual property enforcement, said the index also can be a useful tool for developed countries’ policymakers. They can point to the linkage between property right protections and economic well-being as they try to persuade countries such as China, Russia and India to protect IP rights better, he said.

“You cannot make much progress by talking only about technical flaws or specific concerns,” Israel said.

The IPRI report can be viewed on the IPRI Web site.

For more information on U.S. policies, see Protecting Intellectual Property Rights.

(Distributed by the Bureau of International Information Programs, U.S. Department of State. Web site: http://usinfo.state.gov)