De Soto's reform proposals to be taken up by Cabinet

Henando De Soto would submit his proposals about reforming Pakistan's informal sector and title to properties, which would be taken up in the Cabinet meeting and would be enforced across the board, said Finance Minister Shaukat Aziz.
Addressing a press briefing with De Soto, the minister said that Pakistan "is very much in need of such reforms" in major cities where the new settlements have not been legalised and small business is hindered from contributing substantially to national economy.
De Soto believes that reforming land titling and property ownership would help the small and medium enterprises to get credit by mortgaging these properties and help grow their business.
The developing countries' SMEs do not grow over years because their properties could not help bring capital for more investment.
De Soto, a world famous economist from Peru, earlier in the day delivered a lecture to 200 technocrats, civil and military bureaucracy on his thesis and initial suggestions his team is engaged in drafting with Finance Ministry officials.
President Pervez Musharraf, after going though De Soto's famous book 'The Mystery of Capital: Why Capitalism Triumphs in the West and Fails Everywhere Else', extended an invitation to him.
De Soto said that terrorists can be tackled by making informal sector into formal sector.
The informal sector develops its own laws and follows them to avoid the country's legal system, where the terrorists find their place. Terrorists become redundant when legal system is introduced, which also creates social stability.
He said that the sizes of Pakistani cities have grown nine times, which needs real reforms. In Algeria, urbanisation rate is 15 percent, Haiti 17 percent and Ecuador 11 percent.
The media have contributed to force the rural population to cities for better quality of life.
Almost 75 percent of employment is provided by SME sector in USA. They finance their business from loans taken on their own property mortgage. In developing countries, lands and buildings can not be used for loaning because of cumbersome legal system and shyness from formal sector. Ultimately, an entrepreneur enables himself to issue shares to get more finances.
Pakistan has received assurance from donors that the study done by Institute of Liberty and Democracy (ILD), headed by De Soto, would get funding.