Philippines’ economic freedom ranking dipped from 2007 to 2009

MANILA, Philippines—Economic freedom in the Philippines waned year after year during the last few years of Arroyo administration, the latest annual global study of the Fraser Institute showed.

Based on 2009 data, the latest that were available to the Canadian public policy think tank, economic freedom in the Philippines decreased steadily from 2007 to 2009, along with sinking levels around the world.

Out of a possible best score of 10 points, the country rated 6.83 points in 2007. This slid to 6.77 points in 2008 and further down to 6.46 points in 2009.

Fraser Institute describes economic freedom as “a necessary condition for democratic development [as] (i)t liberates people from dependence on government in a planned economy, and allows them to make their own economic and political choices.”

According to the group, such freedom has four basic ingredients—personal choice, voluntary exchange, freedom to compete, and security of privately owned property.

Out of 141 countries and territories that the yearly Economic Freedom of the World index covers, the Philippines ranked 69th in 2007, 76th in 2008 and 89th in 2009.

Countries are rated and ranked in terms of 42 criteria, which are grouped into five broad areas. These include the size of the government (its expenditures as well as the extent of state firm’s part in national output); the legal structure and security of property rights; access to sound money (free from high and volatile inflation); freedom to trade internationally; and regulation of credit, labor and business.

According to the Fraser Institute, levels of economic freedom have decreased around the world, with the global average score falling to 6.64 in 2009—the lowest in nearly three decades—from 6.67 in 2008.

“In response to the American and European debt crises, governments around the world are embracing perverse regulations and this has huge, negative implications for economic freedom and financial recovery,” vice president Fred McMahon said in a statement.

“The link between economic freedom and prosperity is undeniable,” McMahon said. “Countries that score highly in terms of economic freedom also offer their people the best quality of life.”

He cited research that showed individuals living in countries with high levels of economic freedom enjoyed higher levels of prosperity, greater individual freedoms, and longer life spans.

In the 2009 index, the top three included Hong Kong, Singapore and New

Zealand. They earned respective rates of 9.01, 8.68 and 8.2 points.

The bottom three included Venezuela (4.28), Myanmar or Burma (4.16) and Zimbabwe (4.08).

As for the world’s biggest economies,  the United States ranked 10th (7.6); China was close to the Philippines at 92nd (6.43), and Japan, 22nd (7.44).