Singapore has deposed Hong Kong to become the world’s freest economy, as per a report released by Canadian research organization Fraser Institute.
For the first time since the Economic Freedom of the World Index started in 1970, Hong Kong has slipped from its top position to second place — and its score is going to drop significantly further.
A portion of the precepts used to check economic index are measured based on ease of international trade, freedom to enter and compete in markets, as well as business regulations, amongst other yardsticks.
The findings in the 2023 report are based on data from 2021, the most recent year with available comparable statistics across the 165 jurisdictions. It measures the economic freedom of individuals — or their ability to make economic decisions on their own.
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Hong Kong’s new turn is an illustration of how economic freedom is personally associated with civil and political freedom, specialists say.
New regulatory barriers to entry, increasing cost of business, and limits on employing foreign labor dented Hong Kong’s ranking, the report stated.
Some experts also say, these repressions, combined with the government’s efforts to control the private sector, inevitably led to diminished economic freedom. Hong Kong’s prosperity will likely suffer as a result.
In 2020, China imposed a national security law in Hong Kong which critics slammed as a curtailment of the city’s autonomy. Under the new legislation, crimes of secession and sedition are punishable by up to life in prison.
Singapore moved to the top position from second spot the earlier year.
Driven by increases in its size of government and guideline parts, Singapore’s general score rose 0.06 points to take the highest level, according to the report.
Switzerland, New Zealand and the U.S. came third, fourth and fifth positions separately.
Other notable countries include the United Kingdom coming in ninth, while Japan and Germany claimed 20th and 23rd place respectively.
