IDLO'S ROLE IN SUPPORTING LAW FOR SUSTAINABLE ECONOMIC DEVELOPMENT

IDLO'S ROLE IN SUPPORTING LAW FOR SUSTAINABLE ECONOMIC DEVELOPMENT
 
1. Difficult legal institutions in developing countries
In the development process of developing countries, legal institutions play a fundamental role in ensuring the stable operation of the economy, the sustainability of society and the protection of basic human rights. However, in practice, most countries in this group face great difficulties in legal institutions, both in terms of construction and implementation. These difficulties are not only purely technical and administrative in nature but also deeply reflect historical, political, economic and socio-cultural limitations. These weaknesses and inadequacies have created a vicious cycle: ineffective laws undermine social trust, hinder investment, and hinder economic growth; while the lack of development resources makes it difficult for the legal system to be improved, leading to prolonged stagnation. To analyze this situation, it is necessary to look at it from many aspects: legal framework, enforcement mechanism, institutional capacity, transparency and compatibility with international standards.
One of the most prominent difficulties is the lack of transparency, consistency and stability in the legal framework . In many developing countries, the system of legal documents is often overlapping, contradictory or changes too quickly, making it difficult for the state, businesses and people to comply. This stems from the fact that the legislative process is still unscientific, often heavily influenced by immediate political factors rather than the objective needs of society. Many laws are built in urgent situations, without broad consultation, lacking full impact assessment studies, leading to low effectiveness or difficulty in implementation. Some countries also apply a "hybrid" legal system between statutory law and customary law, in which there is no clear mechanism to harmonize, making the application of the law complicated and inconsistent. For the business environment, the instability and unpredictability of this legal framework is a major barrier, undermining investor confidence and hindering the formation of sustainable economic relations.
Along with the inadequacies of the legal framework, the issue of law enforcement is a serious bottleneck. Many international studies show that the gap between “law on paper” and “law in practice” in developing countries is often very large. Although many countries have nominally enacted modern laws related to economics, trade, investment, and intellectual property protection, in practice, their application is extremely limited due to the lack of monitoring mechanisms, lack of specialized human resources, and especially corruption . Corruption in the judicial and administrative systems is the leading cause of the decline in fairness, transparency, and effectiveness of the law. In many places, court decisions can be influenced by political interests or bribery, making justice a “commodity” rather than a universal value. This not only causes damage to individuals and businesses, but also erodes society's trust in the rule of law, thereby pushing the economy into an informal state where transactions take place outside the legal framework.
Another important aspect is the limited capacity of legal institutions . In many countries, the court system is overloaded, lacks well-trained personnel, and litigation procedures are lengthy and ineffective. The system of lawyers, notaries, and commercial arbitration is weak and unable to meet the increasingly diverse needs of the economy. In rural and remote areas, people often cannot access basic legal services, leading to a situation where their legal rights are neglected. Many small and medium-sized enterprises – which are the main driving force of the economy – have difficulty accessing legal mechanisms to protect contracts, resolve disputes, or protect intellectual property. As a result, weak institutional capacity has constrained the dynamism of the private economic sector, reducing the country's competitiveness and integration.
The next major difficulty is the lack of security of property rights and contract enforcement , which are the foundation of any market economy. In many developing countries, the ownership of land, property and natural resources is not clearly and fully protected by law. The mechanism for registration, certification or protection of use rights is often complicated and susceptible to manipulation by corruption and vested interests. This leads to widespread land disputes, reducing the motivation for long-term investment, especially in the agricultural and real estate sectors. Similarly, contract enforcement is often difficult due to the slowness of the court system and the lack of expertise in resolving commercial disputes. Many businesses have to accept “informal settlement” through negotiation or extra-legal payments to be able to continue operating. The result is an unfair business environment, with law-abiding businesses disadvantaged compared to those that rely on relationships or bribery to gain benefits.
In addition, the challenge of integrating with the international legal system is also a prominent issue. In the context of globalization, developing countries are forced to participate in the international legal network related to trade, investment, environmental protection, labor rights, etc. However, many countries do not have enough technical capacity to build domestic laws in accordance with international commitments. As a result, there is a situation of "legal backwardness" compared to reality, causing difficulties in implementing international obligations, leading to the risk of disputes in international judicial mechanisms. At the same time, the lack of synchronization between national laws and international standards reduces the attractiveness of the investment environment, because investors are concerned about legal risks and high compliance costs.
The underlying causes of these difficulties can be explained from many perspectives. Historically , many developing countries have experienced colonial rule, with legal systems imported from outside, not based on the local cultural and social foundation, so they lack compatibility and make it difficult to create social consensus. Economically , limited financial resources make it difficult for governments to invest adequately in modernizing the legal system, training human resources and digitizing legal services. Politically , instability, conflict or dictatorship often create an environment unfavorable for transparency and the rule of law. In many countries, the legal system is also seen as a tool to maintain power instead of serving the common good, leading to a serious weakening of independent institutions such as courts or anti-corruption agencies. In addition, social and cultural factors such as traditional customs, gender inequality, and discrimination against ethnic minorities also pose many barriers to law making and enforcement.
The impact of legal institutional difficulties on economic development is enormous. A legal environment lacking transparency and fairness will hinder investment flows, limiting the development of enterprises, especially in the private sector. Lack of security of property rights and contracts will reduce the motivation for accumulation and innovation. Weak legal systems also increase social inequality, when groups with power and connections can exploit advantages, while the poor and vulnerable are left behind. More seriously, the weakening of the rule of law also creates conditions for organized crime, corruption and the informal economy to develop, threatening political stability and national security. All of this raises the urgent need to reform legal institutions in developing countries, not only to promote economic growth but also to build a foundation for sustainable, equitable and inclusive development.
Thus, the difficult situation of legal institutions in developing countries is not simply a technical legal issue, but also reflects deep historical, political, economic and social challenges. This is why international organizations such as IDLO play a key role in supporting these countries. With global experience and a comprehensive approach, IDLO can help to narrow the gap between “law on paper” and “law in practice”, and promote the building of legal systems that are transparent, effective and in line with international standards.
2. The role of IDLO in supporting the development of transparent and fair economic and commercial laws, creating a safe investment environment
In the process of development and international economic integration of developing countries, one of the prerequisites for attracting investment, promoting trade and creating trust for economic entities is the presence of a transparent, fair and stable legal system. However, as analyzed, the reality in many developing countries shows great inadequacies in this field, from the lack of a synchronous legal framework to weaknesses in enforcement, from corruption to the backwardness of laws compared to international standards. In that context, the role of the International Development Law Organization (IDLO) becomes particularly important, as this organization not only provides purely legal technical assistance, but also contributes to creating a favorable institutional environment for sustainable economic development. Through diverse programs, projects and activities, IDLO has accompanied many countries in building and reforming economic and commercial laws towards transparency and fairness, ensuring safety for investment activities and thereby strengthening trust in the rule of law.
One of IDLO's outstanding contributions is to support the development and improvement of the economic and commercial legal framework . For many developing countries, the economic law system is often outdated and has not kept up with the rapid changes of the market economy and globalization. In this context, IDLO has participated in supporting the drafting, review and promulgation of laws related to commercial contracts, competition law, investment law, consumer protection law, bankruptcy law and enterprise dissolution law. These documents play a fundamental role in ensuring market transparency, preventing abuse of dominant position, and protecting equality between economic entities. By providing experts, technical advice and sharing international experience, IDLO helps countries shape an economic law system that is both compatible with global standards and appropriate to national characteristics. This is important because an economic legal framework built on the principles of transparency and fairness will minimize the risk of corruption, create confidence for domestic and foreign investors, and promote healthy competition – a core element of sustainable development.
In addition to supporting law-making, IDLO also plays an important role in reforming administrative and judicial procedures related to economics and trade . A good legal system will be meaningless without an effective enforcement mechanism. In many developing countries, business registration procedures, investment licensing or commercial dispute resolution are often lengthy, complicated and have many potential risks of corruption. IDLO has intervened through programs to simplify procedures, standardize processes and increase the application of information technology in public legal services. The digitization of procedures such as business registration, tax payment, intellectual property registration or access to legal information not only increases transparency but also reduces transaction costs for businesses, especially small and medium enterprises. On the judicial side, IDLO promotes reform of the adjudication process of commercial disputes, encourages alternative dispute resolution (ADR) mechanisms such as arbitration and commercial mediation, thereby reducing the burden on the courts, while creating conditions for businesses to access justice more quickly and effectively.
One content that cannot be ignored is the guarantee of property rights and contract rights , which are the core of every market economy. IDLO has supported many countries to build a strong legal mechanism to protect property rights, including land ownership rights, intellectual property rights and investment rights. This is especially important in countries where land disputes, intellectual property infringement or property expropriation frequently occur due to the lack of a solid legal mechanism. Protecting property rights and contracts not only strengthens investor confidence but also encourages innovation, ensuring that the results of labor and creativity of individuals and organizations are protected by law. When property rights are guaranteed, people and businesses have the motivation to accumulate and invest long-term, contributing to promoting sustainable economic growth.
In the context of globalization, a major challenge for developing countries is the compatibility between domestic laws and international standards . IDLO has played a bridging role in helping countries review and amend their economic and commercial legal systems to comply with international commitments, especially within the framework of the World Trade Organization (WTO), free trade agreements (FTAs) and international conventions on labor rights, environmental protection, and anti-corruption. This support helps countries avoid the risk of isolation, improve their competitiveness in global trade, and ensure that the integration process does not harm the legitimate rights and interests of citizens. IDLO also helps train legal staff, civil servants, judges and lawyers on international commercial law, in order to improve the ability to enforce and respond to transnational disputes.
In addition to supporting the state, IDLO places special emphasis on promoting the equitable participation of disadvantaged groups in the economy . In many societies, women, small and medium-sized enterprises (SMEs), ethnic minorities or indigenous communities often face difficulties in accessing legal services, finance and market opportunities. IDLO has implemented many programs to remove legal barriers, enabling women to own land, access credit, establish businesses and engage in commercial activities. At the same time, the organization supports labor law reforms to protect the rights of workers in the informal sector – where women are the majority. Ensuring that disadvantaged groups participate equally in the economy not only brings social justice, but also expands the production and consumption base, contributing to promoting comprehensive growth.
Another important aspect is to increase investor confidence and improve the investment climate . Investor confidence depends on the level of predictability and legal security provided by the legal system. IDLO, through its support for the development of transparent investment laws, investor protection mechanisms, and international investment dispute settlement (ISDS) mechanisms, has helped many countries create a more trustworthy investment climate. This confidence not only attracts foreign direct investment (FDI) but also encourages domestic enterprises to expand production and reinvest. In particular, by promoting transparent legal incentives instead of “tacit agreements”, IDLO contributes to minimizing corruption risks, ensuring that investment benefits are distributed fairly and serving sustainable development.
IDLO’s role in this area is not only impactful at the national level, but also has a regional and global impact. By promoting transparent and fair economic and trade legislation, IDLO contributes to the formation of an international economic order based on the rule of law, where trade and investment relations are governed by law rather than power. This is in line with goal 16 of the United Nations 2030 Agenda for Sustainable Development, which emphasizes peace, justice and strong institutions. At the same time, it also supports the achievement of other goals such as poverty eradication (SDG 1), gender equality (SDG 5), sustainable economic growth (SDG 8) and reduced inequality (SDG 10).
In short, through a series of activities from supporting the development of legal frameworks, reforming administrative and judicial procedures, ensuring property and contract rights, promoting international legal integration, to encouraging the participation of disadvantaged groups and strengthening investor confidence, IDLO has affirmed its indispensable role in helping developing countries create a transparent, fair and secure economic and commercial legal environment. This is not only a necessary condition for sustainable economic development, but also a foundation for ensuring social justice, strengthening the rule of law and contributing to global stability.
3. Specific activities of IDLO
In promoting the rule of law and building legal institutions for sustainable development, the International Development Law Organization (IDLO) not only focuses on general conceptual frameworks or macro-level reforms, but also implements specific activities to strengthen the legal foundation in key areas of economic life. In fact, areas such as property rights, contracts, dispute resolution, investment law, international trade and labor rights protection are both pillars of the market economy system and areas where legal inadequacies can easily damage the economy and erode the trust of actors. IDLO's activities in these areas demonstrate a comprehensive approach: both enhancing the transparency and fairness of the legal system and improving enforcement capacity to ensure that the principles of the rule of law are truly put into practice.
Firstly, in the area of property rights , IDLO has implemented many programs to support developing countries in building legal mechanisms to protect the assets and legal ownership of individuals and organizations. In many countries, especially in Africa and South Asia, land disputes, property ownership without valid documents or being expropriated are still very common. When property rights are not secured, people and businesses lack the motivation to invest in the long term, because the risk of losing property is very high. IDLO has helped governments build transparent land registration systems, digitize property data, and issue legal mechanisms to protect the property rights of women and indigenous communities. This activity not only strengthens social trust but also expands access to credit, because legal ownership becomes the basis for mortgages and capital mobilization, thereby stimulating sustainable economic growth.
Second, IDLO pays special attention to contract protection mechanisms , which are the foundation of all economic transactions. A market economy cannot function if contracts are not respected and enforced. In many developing countries, due to overloaded or opaque court systems, contract dispute resolution is often protracted and unfair, increasing transaction costs. IDLO has supported the development of modern, unified contract laws in line with international practices; at the same time, it has trained judges, arbitrators and lawyers in commercial dispute resolution skills. Some pilot programs also promote the application of commercial mediation and commercial arbitration mechanisms as alternatives to the courts, both reducing the burden on the judicial system and increasing flexibility for the parties. As a result, economic entities, especially small and medium-sized enterprises, can feel more secure when participating in the market.
Third, in the field of dispute resolution , IDLO considers this a core condition to strengthen the rule of law. Going beyond contract disputes, IDLO also supports countries in building specialized commercial courts, independent arbitration systems, as well as legal frameworks for alternative dispute resolution (ADR). Promoting ADR is especially useful in countries where the traditional court system is weak, as it helps reduce costs, shortens time, and encourages consensus between parties instead of tense confrontation. In this way, IDLO not only helps protect the legitimate rights and interests of the subjects, but also contributes to maintaining social stability, a very important factor for the investment environment.
Fourth, investment law is an area where IDLO carries out many specific activities to ensure transparency, fairness and balance of interests. In many developing countries, investment policies are often dominated by vested interests, or lack mechanisms to protect investors, leading to high risks and expensive transaction costs. IDLO supports governments in drafting transparent investment laws that clearly define the rights and obligations of investors as well as the responsibilities of the state. At the same time, this organization promotes fair international investment dispute resolution mechanisms, ensuring that investors' rights are respected without undermining the state's ability to make public policy. This is a difficult balance to achieve, but is very important to both attract investment capital and protect national development interests.
Fifth, in the field of international trade , IDLO plays a bridging role in helping developing countries improve their legal capacity to integrate more deeply into the global trading system. Participating in trade agreements requires countries to adjust their domestic legal systems to be compatible, from regulations on tariffs, import and export to technical standards and intellectual property protection. IDLO has implemented legal training programs, supported the review and amendment of trade laws, and advised governments in international negotiations. As a result, developing countries can better take advantage of opportunities from globalization while minimizing legal risks when participating in international trade disputes.
Finally, an important area that IDLO focuses on is the protection of labor rights . In many developing economies, the informal sector is large, and workers – especially women and young people – often lack employment contracts, social security, or safe working conditions. IDLO has supported labor law reform, promoting standards for fair labor conditions, prohibiting child labor, protecting the rights of migrant workers, and strengthening labor inspection mechanisms to ensure enforcement. In this way, IDLO not only improves the lives of workers, but also contributes to increased productivity, creating a stable and skilled workforce – an important factor for sustainable economic development.
In summary, the specific activities that IDLO carries out in key areas such as property rights, contracts, dispute resolution, investment law, international trade and labor rights not only help to strengthen the legal foundation of the market economy, but also create a transparent, fair and secure environment for development. Through these efforts, IDLO has contributed significantly to the realization of sustainable development goals, promoting international integration, while ensuring that the economic development process is inseparable from the principles of social justice and the protection of human rights.