The Index of Economic Freedom 2017, an annual guide published by the Heritage Foundation, Washington's No. 1 think tank, covers 12 freedoms – from property rights to entrepreneurship – in 186 countries, and revealed that Georgia (with 76 points) had improved its positions by moving from the 23rd place to 13th in the world rankings.
Georgia improves its position in Economic Freedom Index 2017
By Tea Mariamidze
Friday, February 17
As for the regional rankings (Europe Region), Georgia takes position 5 with 68 points, preceding Luxemburg and following the UK.
In the world rankings, Hong Kong takes the top position, followed by Singapore, New Zealand, Switzerland, Austria, Estonia, Canada, United Arab Emirates, Ireland, Chile, Taiwan and the United Kingdom. These states are ahead of Georgia in the list.
In the chart, Georgia is among the states which have the status of ‘mostly free’.
“With monetary stability and the overall soundness of fiscal health relatively well-maintained, Georgia has enjoyed macroeconomic resilience. Nonetheless, deeper and more rapid institutional reforms to enhance judicial independence and effectiveness remain critical to ensuring further dynamic and lasting economic development,” the report reads.
Moreover, the document says that Protection of property rights has improved, and the government has made enforcement of contracts easier.
“Although the constitution and law provide for an independent judiciary, there has been little progress in the past year on judicial reforms, and the government does not fully respect judicial independence. Georgia still struggles with the lingering effects of Soviet-era corruption as well as ongoing Russian influence,” the document says.
The regulatory environment is also efficient this year.
“It takes only three procedures and three days to start a business, and no minimum capital is required. The non-salary cost of hiring a worker is not burdensome, but the labor market lacks dynamism, and unemployment remains fairly high. Dollarization of the economy is high, and the local currency was devalued in 2015 but stabilized in 2016. Inflationary pressure has been kept under control,” the report reads.
The Index of Economic Freedom 2017 says trade is extremely important for Georgia’s economy, adding the value of exports and imports taken together equal 110 percent of GDP.
“With the banking sector growing and modernized, access to financing has improved. Capital markets continue to evolve, but the stock exchange remains small and underdeveloped,” the report says.
Eritrea, Congo, Cuba, Venezuela and North Korea are at the end of Index of Economic Freedom 2017 list.