The Monetary Authority revealed yesterday that for the first time ever Macau ranked sixth in the Index of Economic Freedom, Asia-Pacific Region, and the 21st among 179 economies worldwide, according to Heritage Foundation’s 2009 Report on the Index of Economic Freedom.

The index measures economic freedom within ten specific categories, namely the government size, trade freedom, monetary freedom, investment freedom, financial freedom, labour freedom, business freedom, property rights and freedom from corruption, where Macau ranked remarkably high in the first five factors. The Foundation’s 2009 Report said that Macau is an open and vibrant free-market economy, with an efficient and streamlined overall business environment. It also noted that the foreign investors are welcome to conduct business on the same term as local business people, and Macau’s financial sector is particularly modern and competitive. Macau is ranked the sixth in the Asia-Pacific region, behind Hong Kong, Singapore, Australia,
New Zealand and Japan. Meanwhile, Macau stands in 21st in global ranking, and was classified as the freest.
According to the Heritage Foundation, economic freedom is strongly related to good economic performance, and economies that are rated “free” or “freest” in the 2009 Index enjoy incomes that are more than double the average levels in all other economies, and more than eight times higher than the incomes of “repressed” economies. Another finding is that economies classified as free or mostly free also do a much better job promoting human development, reducing poverty and protecting the environment. The Index expanded its coverage significantly in this year’s report, ranking an additional 21 economies to bring the total number ranked to 179, as reported by the Wall Street Journal. The report also showed that 83 economies representing every region posting gains in the Index, indicating that the level of economic freedom in the world has continued to grow over last year’s. The top ten most free economies are, in ranked order, Hong Kong, Singapore, Australia, Ireland, New Zealand, United States, Canada, Denmark, Switzerland, and the United Kingdom. While the top ten least free economies are, Sao Tome and Principe, Libya, Comoros, Congo, Venezuela, Eritrea, Burma, Cuba, Zimbabwe and North Korea. The United States dropped one place to sixth, because of increases in both tax revenue and government spending as a percentage of GDP, one of the report’s authors, Terry Miller, said in
an article in the Wall Street Journal. Miller, director of the foundation’s Centre for International Trade and Economics, said capitalism has taken a beating in recent months, as financial institutions begged for government intervention to help them through a global crisis.

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