Economic Freedom by Country 2023 - Global Finance Magazine

Global economic freedom has taken a sustained hit thanks to the aftershocks of the Covid-19 pandemic.

Shanghai, China under lockdown during 2021.

New ideas are born every day in homes, schools, workplaces. They can further human development, improve our health and environment, create jobs and wealth. In order for these ideas to turn into reality individuals must be free to work, consume and invest without restrictions. This is the focus of the Index of Economic Freedom, an annual ranking produced by the Heritage Foundation which measures the level of economic freedom in countries around the globe.

The link between economic freedom and human well-being is proven. The adoption of progressive and transparent economic policies often translates into a significant reduction in poverty, sicknesses and ignorance. Since the inception of the ranking in 1995, economic freedom around the world has generally increased. Just three years ago, Heritage Foundation researchers could claim that the global average economic freedom score was at its highest in the history of the index. Then came the Covid-19 pandemic, its economic aftershocks, and the Russian invasion of Ukraine.

The government-imposed fiscal burdens and restrictions on the movement of people and business activity that characterized lockdowns caused severe harm to the global economy according to the Heritage Foundation. Out of 184 nations surveyed in the new edition of the report (which considers economic policies and conditions in the interval between July 1, 2021, through June 30, 2022), declines in economic freedom were registered by 115 of them, 8 were unchanged, and 8 nations could not be graded due to a lack of reliable data.

But how does the Heritage Foundation measure economic freedom in each given country? Twelve are the factors related to four key aspects of the economic environment that are graded from 0 to 100 and averaged to determine a country’s score: rule of law (and related sub-categories: property rights, government integrity, judicial effectiveness); government size (government spending, tax burden, fiscal health); regulatory efficiency (business, labor and monetary freedom); open markets (trade, investment and financial freedom). Overall, the global average score in this year’s ranking was 59.3, corresponding to a 0.7-point decline from the period before and the lowest ever recorded during the past two decades.

Only 4 countries (down from 7 in the previous edition of the report) achieved economic freedom scores of 80 or more and are thus considered economically free; 23 nations were ranked as “mostly free” with scores ranging from 70.0 to 79.9; and 56 were deemed “moderately free,” with scores of 60.0 to 69.9. Alarmingly, 93 nations—or 50% of all the nations ranked—registered economic freedom scores below 60: of those, 65 are considered “mostly unfree” (scores of 50.0 to 59.9), while in the economically “repressed” category can be found 28 countries, including China. Yet, it is also worth noting that China’s chief antagonist has not many reasons to celebrate: the U.S. is only the world’s 25^th freest economy. Its score has plummeted to 70.6, a 1.5-point decline from the 2022 edition of the ranking, making it America’s lowest score ever in the 29-year history of the index.

As the freedom to participate actively and fully in the economy deteriorates worldwide, many hard-fought gains in all areas of civil society appear to be in jeopardy. According to the experts at the Heritage Foundation, the benefits of economic freedom go far beyond just higher incomes or reduced levels of poverty. Countries that aim for higher levels of economic freedom enjoy down the road superior levels of overall human development as measured by the United Nations Human Development Index (HDI). Remarkably, it is often the policies that governments fail to implement—rather than the counterproductive ones that are put in place—that can be the most damaging to economic growth. By providing greater economic freedom today, governments can improve educational opportunities and their citizens’ living standards tomorrow.

Rank	Country/Territory	Economic Freedom Score
1	Singapore	83.9
2	Switzerland	83.8
3	Ireland	82.0
4	Taiwan	80.7
5	New Zealand	78.9
6	Estonia	78.6
7	Luxembourg	78.4
8	Netherlands	78.0
9	Denmark	77.6
10	Sweden	77.5
11	Finland	77.1
12	Norway	76.9
13	Australia	74.8
14	Germany	73.7
15	South Korea	73.7
16	Canada	73.7
17	Latvia	72.8
18	Cyprus	72.3
19	iceland	72.2
20	Lithuania	72.2
21	Czech Republic	71.9
22	Chile	71.1
23	Austria	71.1
24	United Arab Emirates	70.9
25	United States	70.6
26	Mauritius	70.6
27	Uruguay	70.2
28	United Kingdom	69.9
29	Barbados	69.8
30	Portugal	69.5
31	Japan	69.3
32	Bulgaria	69.3
33	Slovakia	69.0
34	Israel	68.9
35	Georgia	68.7
36	Qatar	68.6
37	Slovenia	68.5
38	Samoa	68.3
39	Jamaica	68.1
40	Poland	67.7.
41	Malta	67.5
42	Malaysia	67.3
43	Belgium	67.1
44	Peru	66.5
45	Costa Rica	66.5
46	Croatia	66.4
47	Cabo Verde	65.8
48	Brunei Darussalam	65.7
49	Albania	65.3
50	Armenia	68.2
51	Spain	67.9
52	Botswana	64.9
53	Romania	64.5
54	Hungary	64.1
55	Panama	63.8
56	North Macedonia	63.7
57	France	63.6
58	Serbia	63.5
59	Saint Vincent and Grenadines	63.5
60	Indonesia	63.5
61	Mexico	63.2
62	Colombia	63.1
63	Bosnia and Herzegovina	62.9
64	Guatemala	62.7
65	Dominican Republic	62.6
66	Micronesia	62.6
67	The Bahamas	62.6
68	Bahrain	62.5
69	Italy	62.3
70	Vanuatu	62.1
71	Kazakhstan	62.1
72	Vietnam	61.8
73	Mongolia	61.7
74	São Tomé and Príncipe	61.5
75	Azerbaijan	61.4
76	Paraguay	61.0
77	Montenegro	60.9
78	Kosovo	60.7
79	Saint Lucia	60.7
80	Thailand	60.6
81	Côte d’Ivoire	60.4
82	Tongoa	60.0
83	Tanzania	60.0
84	Benin	59.8
85	Belize	59.8
86	Dominica	59.7
87	Seychelles	59.5
88	Trinidad and Toba	59.5
89	Philippines	59.3
90	Bhutan	59.3
91	Madagascar	58.9
92	Kiribali	58.8
93	Jordan	58.8
94	Honduras	58.7
95	Oman	58.5
96	Moldova	58.5
97	Morococco	58.4
98	Saudi Arabia	58.3
99	Ghana	58.0
100	Fiji	58.0
101	The Gambia	57.9
102	Namibia	57.7
103	Senegal	57.7
104	Turkey	56.9
105	Guyana	56.9
106	Solomon Islands	56.9
107	Greece	56.9
108	Kuwait	56.7
109	Uzbekistan	56.5
110	Cambodia	56.5
111	Burkina Faso	56.2
112	Djibouti	56.1
113	Gabon	56.1
114	El Salvador	56.0
115	Kyrgyz Republic	55.8
116	South Africa	55.7
117	Mauritania	55.3
118	Togo	55.3
119	Ecuador	55.0
120	Eswatini	54.9
121	Nicaragua	54.4
122	Mali	54.5
123	Bangladesh	54.4
124	Nigeria	53.9
125	Russia	53.8
126	Niger	53.7
127	Brazil	53.5
128	Comoros	53.5
129	Guinea	53.2
130	Angola	53.0
131	India	52.9
132	Tunisia	52.9
133	Malawi	52.8
134	Mozambique	52.5
135	Kenya	52.5
136	Sri Lanka	52.2
137	Rwanda	52.2
138	Chad	52.0
139	Cameroon	51.9
140	Papua New Guinea	51.7
141	Leostho	51.6
142	Nepal	51.4
143	Uganda	51.4
144	Argentina	51.0
145	Belarus	51.0
146	Tajikistan	50.6
147	Laos	50.3
148	Sierra Leone	50.2
149	Haiti	49.9
150	Liberia	49.6
151	Egypt	49.6
152	Pakistan	48.3
153	Equatorial Guinea	48.1
154	China	48.3
155	Ethiopia	48.3
156	Congo, Republic of	48.1
157	Congo, Democratic Republic of the	47.9
158	Zambia	47.8
159	Timor-Leste	47.2
160	Maldives	46.6
161	Turkmenistan	46.5
162	Burma	46.5
163	Suriname	46.1
164	Lebanon	45.6
165	Guinea-Bissau	44.6
166	Central African Republic	43.8
167	Bolivia	43.4
168	Algeria	43.2
169	Iran	42.2
170	Burundi	41.9
171	Eritrea	39.5
172	Zimbabwe	39.0
173	Sudan	32.8
174	Venezuela	25.8
175	Cuba	24.3
176	North Korea	2.9
177	Afghanistan	N/A
178	Iraq	N/A
179	Libya	N/A
180	Lichtenstein	N/A
181	Somalia	N/A
182	Syria	N/A
183	Ukraine	N/A
184	Yemen	N/A

N/A — Not available. Source: 2023 Index Of Economic Freedom, The Heritage Foundation.

Rank

Country/Territory

Economic Freedom Score