World Economic Freedom Index 2016 released

The Economic Freedom of the World: 2016 Annual Report has been released worldwide by the Centre for Civil Society, a public policy think tank, along with Canada’s Fraser Institute.

• The report measures the degree of economic freedom in countries in five broad areas based on 2014 data – size of government: expenditure, taxes and enterprises; legal structure and security of property rights; access to sound money; freedom to trade internationally and regulation of credit, labour, and business.

Highlights:

• Hong Kong topped the index, followed by Singapore and New Zealand among 159 countries.
• India has been ranked 112^th. India has slipped 10 positions and ranks behind Bhutan (78), Nepal (108) and Sri Lanka (111) but stood higher than China (113), Bangladesh (121) and Pakistan (133).


• India has fared badly in all categories i.e. legal system and property rights (86), sound money (130), freedom to trade internationally (144) and regulation (132) except the size of the government (8),” as per the report.
• The 10 lowest-ranked countries are Iran, Algeria, Chad, Guinea, Angola, Central African Republic, Argentina, Republic of Congo, Libya and lastly Venezuela.
• Other notable countries include the United States (16), Germany (30), Japan (40), France (57) and Russia (102).
• In the top quartile, the average income of the poorest 10% was $11,283, compared with $1,080 in the bottom quartile in 2014. Interestingly, the average income of the poorest 10% in the most economically free nations was twice the average per capita income in the least free nations, says the report.
• Life expectancy was 80.4 years in the top quartile compared with 64 years in the bottom quartile, while political and civil liberties were also considerably higher in economically free nations.

Significance of economic freedom index:

The economic freedom index of a country is directly proportional to the freedom and opportunities available to its citizens. People living in countries with high levels of economic freedom enjoy greater prosperity, more political and civil liberties, and longer lives. On the contrary, countries at the lower levels of freedom index tend to suppress its citizens’ freedom and rights.