Johannesburg – South Africa has moved up five places on the Economic Freedom of the World rankings, produced every year by the Vancouver-based Fraser Institute.
The report, which is released in Canada this afternoon, showed that in 2001 – the latest year under review as it is the most recent year for which data are available – South Africa went from 47th to 42nd place in the 123-country rankings, even though its overall freedom score remained unchanged at 6.8 out of 10.
South Africa fell far behind Mauritius, which is ranked 20th overall with a score of 7.3, and Botswana, which is in 26th place with a rating of 7.1.
Hong Kong retained the world’s highest economic freedom rating at 8.6, followed by Singapore at 8.5, the US at 8.3, and New Zealand and the UK, both at 8.2.
South Africa’s ranking was higher than those of large economies like France (44th), Mexico (69th), India (73rd), Brazil (81st), China (100th) and Russia (112th).
The bottom five nations on the rankings are Guinea-Bissau (4.4), Algeria (4.2), Zimbabwe (4), the Democratic Republic of the Congo (3.9) and Myanmar (3.8).
Other nations for which data are not available, such as North Korea and Cuba, might have even less economic freedom, the Fraser Institute said.
The rankings take into account 38 variables, including 18 survey-based variables obtained from the International Country Risk Guide and the Global Competitiveness Report./P>
South Africa’s climb up the rankings came at the expense of France, Greece, Peru, the Bahamas, Argentina and the Phillipines, which all became “less free”, the report said.
Neil Emerick, a councillor of the Free Market Foundation in South Africa, said the report found that since 1995 the biggest restrictions in local economic freedom had come about in hiring and firing practices, where the score had gone from 5.6 to 2.2; the size of government enterprises as a percentage of gross domestic product (6 to 4); and the share of the labour force whose wages were set by collective bargaining (6.2 to 4.2).
Other significant drops in economic freedom had arisen from time spent with government bureaucracy and the integrity of the legal system, he said.
“The growing level of unemployment and the lack of investment through lawlessness should therefore be major areas of concern for the government, especially with next year’s election looming,” Emerick said.
Over the past decade, the freest nations had averaged annual economic growth of 2.3 percent, while the least free nations had contracted 0.6 percent a year.
By Quentin Wray, Business Report, Africa
