Fraser Institute of Canada Analysis of Economic Freedom
7 Aug 2015
- The soundness of a country’s currency.
2. Its freedom of trade internationally.
3. The extent of the regulations it imposes on the private sector.
4. The size of its government.
5. Its respect for property rights.
In monitoring these areas the Fraser Institute divided countries into four quartiles ranging from the least economically free to the most economically free in terms of these five criteria.
Fraser Institute began monitoring from the 1980s. In a 20 year study (from 1990 to 2010) GDP grew at an annual average rate of 1.6% for the ‘least free”, in contrast “most free” grew by 3.6% on average. Because of the difference in growth rate the” least free” recorded an average GDP per head of US$5 200 in 2000, while the “most free” recorded a figure near to US$38 000 (seven times higher).
Also the average per capita income of the poorest 10% of people in the” least free” was US$1 201, whereas the most free was US$12 000.
For South Africa:
In 2001 SA ranked 41 out of 143 countries.
In 2013 SA ranked 88 out of 152 countries.
This placed SA in the third quartile, not far above countries in the least free quartile. It rated SA below Kazakhstan and Kenya, only slightly above Paraguay, Ghana and Tanzania.
Contrast the freedom criteria of the Fraser Institute with the criteria of the EFF (Economic Freedom Fighters):
- Massive state interference
- Nationalisation of mines and banks.
- And the element of land grabbing without compensation.
Hong Kong, despite size and belonging to Communist China topped the 2013 survey- highest rate of economic freedom and highest levels of prosperity in the world.