What’s the difference between countries that prosper and those that flounder? What’s the difference between Mexico and USA? Or North Korea vs South Korea? Or Germany vs Ukraine?
Countries are made up of people. If there is no human population then it’s not a country.
So it’s the people that are the key. How do you get people to invest time, effort and capital in your country? How do get people to think long term? Long term is not five years. Fifty years is long term.
The answer is actually quite simple. For people to invest they need to know that if they work hard they can make money and actually keep it.
Institutions are the key. These are the foundations for certainty. Without certainty that I can reap the rewards of my efforts I will not invest any effort. But that isn’t enough. If I can’t be sure I’ll be allowed to keep the fruit of my labour, then I will not invest.
That’s the difference between country success and failure. The existence of institutions that protect your right to make money and keep your money.