HK has World's Greatest Economic Freedom Says CATO Institute

by Mary Swire, Tax-News.com, Hong Kong

16 July 2003

The CATO Institute, in partnership with the Fraser Institute of Canada last week released the Economic Freedom of the World Annual Report 2003 which has rated Hong Kong as the world's most free economy.

The report, compiled by James Gwartney of Florida State University and Robert Lawson of Capital University assesses 123 nations using 38 separate variables for each country. The authors argue that the main foundations of economic freedom are personal choice, voluntary exchange, freedom to compete, and the protection of persons and property. Using this criterion, the report puts Hong Kong at the top of the economic freedom league table, closely followed by Singapore and the United States in 2nd and 3rd places respectively.

Other nations in the top ten included New Zealand, the United Kingdom, Canada, Australia, Ireland, Switzerland and Holland. Amongst the other G7 nations, Germany was ranked 20th, Japan 26th, Italy 35th and France 44th. India was placed 73rd, China 100th and Russia 112th. The nations in the survey with the least economic freedom were Guinea-Bissau, Algeria, Zimbabwe, the Democratic Republic of Congo and Myanmar.

Whilst most sub-Saharan nations fared particularly badly in the report, one African country that can be considered somewhat of a success story in recent years is Botswana which was placed 26th (equal with Japan) way ahead of its African counterparts. According to the report, Botswana has achieved the highest per-capita GDP in the region at US$3,950, compared with a sub-Saharan average of just US$564.

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