Ideas CEO calls for review of policies as Malaysia slips in economic freedom ranking
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Malaysia’s fall to 79th spot from 67th in the 2018 Economic Freedom of the World Annual Report shows that space for the private sector in the country has been squeezed, businesses have been obstructed and the size of the government has increased.
Institute for Democracy and Economic Affairs (Ideas) CEO Ali Salman said the findings based on data from 2016, the most recent year of available comparable data, measure economic freedom, that is, levels of personal choice, ability to enter markets, security of privately owned property, rule of law, etc, by analysing the policies and institutions of 162 countries and territories.
“This calls for a comprehensive review of economic policies under the Pakatan Harapan (PH) administration, spanning critical areas like GLC reforms, size of the civil service and business regulations – areas on which Ideas has researched and advocated vigorously,” Ali said.
According to research in top peer-reviewed academic journals, people living in countries with high levels of economic freedom enjoy greater prosperity, more political and civil liberties, and longer lives.
For example, countries in the top quartile (25%) of economic freedom (such as the UK, Japan and Ireland) had an average per-capita income of US$40,376 in 2016 compared with US$5,649 for the bottom quartile countries (such as Venezuela, Iran and Zimbabwe).
And life expectancy is 79.5 years in the top quartile of countries compared to 64.4 years in the bottom quartile.
“Where people are free to pursue their own opportunities and make their own choices, they lead more prosperous, happier and healthier lives,” said Fred McMahon, Dr Michael A. Walker Research Chair in Economic Freedom with the Fraser Institute.
“Where people are free to pursue their own opportunities and make their own choices, they lead more prosperous, happier and healthier lives,”
The report was released by Ideas and produced by Canada’s Fraser Institute.
The Fraser Institute produces the annual Economic Freedom of the World report in cooperation with the Economic Freedom Network, a group of independent research and educational institutes in nearly 100 countries and territories.
It is the world’s premier measurement of economic freedom, measuring and ranking countries in five areas: size of government, legal structure and security of property rights, access to sound money, freedom to trade internationally and regulation of credit, labour and business.
Hong Kong and Singapore again topped the index, continuing their streak in first and second place respectively, while New Zealand, Switzerland, Ireland, the US, Georgia, Mauritius, the UK, Australia and Canada (tied for 10th spot) round out the top 10.
The 10 lowest-ranked countries are Sudan, Guinea-Bissau, Angola, Central African Republic, Republic of Congo, Syria, Algeria, Argentina, Libya and Venezuela.
Countries such as North Korea and Cuba could not be ranked due to lack of data.
Other notable country rankings include Germany (20th), Japan (41st), France (57th), Russia (87th) and China (108th).
Questions & Answers
Q.What does Malaysia's drop in the economic freedom ranking indicate about the country's economic environment?
What does Malaysia's drop in the economic freedom ranking indicate about the country's economic environment?
The report indicates that the private sector's space in Malaysia has been constrained, businesses have faced obstacles, and the government's size has expanded. This suggests a less free economic environment for the country.
Q.What specific areas has the Ideas CEO highlighted for policy review following the report's findings?
What specific areas has the Ideas CEO highlighted for policy review following the report's findings?
The CEO of Ideas, Ali Salman, has called for a comprehensive review of economic policies, specifically mentioning GLC reforms, the size of the civil service, and business regulations. Ideas has actively researched and advocated in these areas.
Q.Which countries consistently rank highest in the Economic Freedom of the World report?
Which countries consistently rank highest in the Economic Freedom of the World report?
Hong Kong and Singapore consistently top the index, holding the first and second positions respectively. New Zealand, Switzerland, Ireland, and the UK are also among the top-ranked countries in the report.