SA drops in economic freedom ranking

2011-09-23 07:02

South Africa has dropped five places to 87th out of 141 countries in a ranking of economic freedom.

“A decade ago South Africa ranked 39th, a slide of 48 places from the top 35% to the bottom 40% of the 141 countries measured,” according to the Economic Freedom of the World: Annual Report 2011 released last night by the Free Market Foundation (FMF), a member of the Economic Freedom Network.

The report found that South Africa’s government was having a greater say in the economic decisions of its citizens, both in the proportion of state involvement in the economy relative to private ownership, and in the regulation of business.

The FMF said in a statement: “For example, the National Credit Act lays down extensive rules about how and under what conditions creditors can lend money to debtors.”

In the category of government enterprises and investment as a proportion of the economy, South Africa now ranks 116th, dropping 27 places this year.

The report defines economic freedom as the right of individuals to acquire property through lawful means and to freely use, exchange or give away their property as long as their actions do not violate the rights of others.

An index of economic freedom measures the extent to which governments impact on this definition.

“The findings suggest that countries with a less intrusive state are better at generating successful outcomes than those that try to do too much,” said Neil Emerick, an FMF council member.

The 10 countries defined as “most free” by the index are: Hong Kong, Singapore, New Zealand, Switzerland, Australia, Canada, Chile, United Kingdom, Mauritius and the United States.

The 10 countries described as “least free” are: Zimbabwe, Myanmar, Venezuela, Angola, Democratic Republic of the Congo, Burundi, Central African Republic, Guinea-Bissau, Republic of Congo, and Chad.

Income in the “most free” countries is $33 881 (R283 753) yearly per person, while income for the least economically free is $2 282 (R19 111). 

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