Resilient HK retains freest economy crown

Updated: 2015-01-29 07:28

By Celia Chen in Hong Kong(HK Edition)

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Hong Kong has retained the title of the world's freest economy for the 21st straight year, according to the 2015 Index of Economic Freedom report released by the Heritage Foundation, a Washington-based think tank.

The SAR scored 89.6 out of 100 points in overall economic freedom, with slight improvements in business freedom, labor freedom and fiscal freedom components.

The Index covers 10 freedoms, from property rights to entrepreneurship, in 186 countries and regions in five groups - free, mostly free, moderately free, mostly unfree and repressed - on a scale of 0 to 100 points.

Heritage Foundation said Hong Kong continues to thrive on the free flow of goods, services and capital. "As the economic and financial gateway to the Chinese mainland, and with an efficient regulatory framework, low and simple taxation, and sophisticated capital markets, the city continues to offer the most convenient platform for international companies doing business on the mainland," it said.

Hong Kong's "impressive level of resilience" enables it to defend against global economic swings and domestic shocks, the foundation added.

Resilient HK retains freest economy crown

The Hong Kong government welcomed the latest rankings. "The government will continue to uphold our fine tradition of the rule of law, a clean society with a level playing field, an efficient public sector and a simple tax regime with low tax rates," a spokesman said.

Hot on the heels of Hong Kong in the overall ranking was Singapore, scoring 89.4 to take second place, followed by New Zealand, Australia and Switzerland. But Hong Kong's lead over its closest rival further narrowed to just 0.2 points from 0.5 points last year.

The Chinese mainland and India, the top two economies with the largest populations, ranked 139th and 128th, respectively, in the world and both remain "unfree".

But the new report from the Heritage Foundation shows significant improvement in the Asia-Pacific region, despite the Chinese mainland and India's "unfree" performance. For the second year in a row, the Asia-Pacific has outperformed the five other regions measured in the index.

Twenty-seven of its economies charted rising scores, while 13 declined. Seven, including Taiwan, Vietnam and Laos, achieved their highest scores since the index was launched in 1995 to measure economic freedom in the world.

The US finally halted its five-year slide, rising by 0.7 points in the latest rankings, but stayed at the 12th spot among world economies. North America is still the world's freest region, but Canada, which had led the region since 2010, lost 1.1 points last year and slid into the "mostly free" category.

As for Europe, the foundation said economic freedom has expanded in the region, but mounting "policy barriers" to growth persist.

(HK Edition 01/29/2015 page8)