HK Retains World’s Freest Economy Rank

Hong Kong has retained its title as the world’s freest economy for the 22nd year in a row, according to the latest Index of Economic Freedom, even as rising political strife and civil discontent grip the financial hub.

The index—published annually by the Wall Street Journal and think tank the Heritage Foundation—judges economic freedom on four key pillars: rule of law, limited government, regulatory efficiency and open markets, CNBC reported.

People in economically free societies earn incomes more than twice the average levels in all other countries and they live longer too, according to the latest report.

“Hong Kong is free because it has a better right to higher wages, longer lives, a better environment—all of that comes with economic freedoms,” Ed Feulner, the think tank’s founder, told CNBC, noting the city’s transformation from a manufacturing-driven economy to one that’s now 97% service-oriented.

Some of the ‘freest’ countries on the index were Asian Pacific (APAC) economies: Singapore came in second, with New Zealand at third and Australia fifth. In fourth place, Switzerland was the sole non-APAC economy in the top five.

The index’s global average economic freedom score was 60.7—the highest recorded in the index’s 22-year history—as more developing nations, including India, Myanmar and the Philippines, climbed up the rankings.

Declining economic freedom was reported in 19 advanced economies, such as the United States, Japan and Sweden. “With scores in labor freedom, business freedom and fiscal freedom notably declining, the economic freedom of the United States plunged 0.8 point to 75.4, matching its lowest score ever,” the Heritage Foundation said.

While Hong Kong is known for strong private property rights, openness to global trade and financial flows, its track record in other areas is becoming spotty.