2011 Index of Economic Freedom

Data provided by: THE WALL STREET JOURNAL. eritage Foundation 2011 INDEX of ECONOMIC FREEDOM ABOUT THE INDEX For over a decade, The Wall Street Journal and The Heritage Foundation, Washington's preeminent think tank, have tracked the march of economic freedom around the world with the influential Index of Economic Freedom. Since 1995, the Index has brought Adam Smith's theories about liberty, prosperity and economic freedom to life by creating 10 benchmarks that gauge the economic success of 183 countries around the world. With its user-friendly format, readers can see how 18th century theories on prosperity and economic freedom are realities in the 21st century. HOW THE INDEX IS CALCULATED They measure ten components of economic freedom, assigning a grade in each using a scale from 0 to 100, where 100 represents the maximum freedom. The ten component scores are then averaged to give an overall economic freedom score for each country. The ten components of economic freedom are: • BUSINESS FREEDOM • TRADE FREEDOM • MONETARY FREEDOM • INVESTMENT FREEDOM • PROPERTY RIGHTS • LABOR FREEDOM • FISCAL FREEDOM GOVERNMENT SPENDING • FINANCIAL FREEDOM • FREEDOM FROM CORRUPTION THE TOP 20 COUNTRIES REPRESSED FREE (OVERALL RANK RANK COUNTRY CHANGE FROM 2010 Hong Kong 89.7 Singapore 87.2 Australia 82.5 4 New Zealand 82.3 Switzerland 81.9 Canada 80.8 Ireland 78.7 8. Denmark 78.6 9. United States 77.8 10 Bahrain 77.7 11 Chile 77.4 12 Mauritius 76.2 13 Luxembourg 76.2 14 Estonia 75.2 15 Netherlands 74.7 16 United Kingdom 74.5 17 Finland 74.0 18 Cyprus 73.3 19 Масаи 73.1 20 Japan 72.8 20 40 60 80 100 -3.0 -2.0 -1.0 0.0 1.0 2.0 THE RISE & FALL RWANDA vs. ICELAND OVERALL RANK v CHANGE FROM 2010 Rwanda 62.7 +3.6 GREATEST RISE 77 78 77 79 68.5 50 40 35 33 90 Iceland 68.2 -5.5 GREATEST FALL 93 88 69 0 69 65 60 90 87 61 FREEDOM RANKS 80 -6 -5 -4 -3 -2 -1 0 1 2 3 4 20 40 60 100 Rwanda scores relatively high in business freedom, fiscal freedom, and labor freedom. Personal and corporate tax rates are moderate. With a sound regulatory framework that is conducive to private-sector development, Rwanda has achieved annual economic growth of around 7 percent over the past five years. Iceland's financial sector was severely affected by the global financial turmoil. Aggressive overseas expansion of bank lending, unchecked by the domestic regulatory environment, caused the buildup of considerable systemic risk for such a small economy. The resulting collapse of the banking sector has led to a sharp surge in the budget deficit and a rising government debt of over 100 percent of GDP. Total government expenditures are extremely high. In the most recent year, government spending, including consumption and transfer payments, soared to 57.8 percent of GDP. THE WORLD Economic Freedom Scores 1 80-100 Free I 70-79.9 Mostly Free 60-69.9 Moderately Free 1 50-59.9 Mostly Unfree 10-49.9 Repressed 2 Not Ranked 2011 ECONOMIC SNAPSHOT OF THE WORLD THE UNITED STATES 77.8 #09 Population: 307.4 MILLION Unemployment: 9.6% Inflation (CPI):-0.3% FDI Inflow: $129.9 BILLION GDP (PPP): $14.2 TRILLION GDP Growth: -2.4% 0.7% 5-Year Compound Annual Growth GDP per capita: $46,381 OVERALL SCORE WORLD RANK The United States' economic freedom score is 77.8, 100 making its economy the 9th freest in the 2011 Index. Its score is 0.2 point lower than last year, reflecting deteriorating business freedom, trade freedom, government spending, and monetary freedom. The U.S. is ranked 2nd out of three countries in the North 90 80 70 America region, and its overall score is well above the world and regional averages. 1995 1999 2003 2007 2011 91.0 86.4 68.3 54.6 77.4 BUSINESS FREEDOM V-0.3 from 2010 GOV'T SPENDING -3.4 from 2010 TRADE FREEDOM FISCAL FREEDOM MONETARY FREEDOM V-0.5 from 2010 A +0.8 from 2010 V-0.7 from 2010 BUSINESS TRADE FISCAL GOV'T MONETARY INVEST. FINANCIAL PROPERTY CORRUPT. LABOR +2.0 +1.0 0.0 NO CHANGE NO CHANGE – NOCHANGE -2.0 -3.0 75.0 70.0 85.0 75.0 95.7 INVEST. FREEDOM O from 2010 FREE. FROM CORRUPT. A +2.0 from 2010 LABOR FREEDOM A +0.9 from 2010 FINANCIAL FREEDOM PROPERTY RIGHTS 10 from 2010 10 from 2010 PRODUCED BY: THE YOUNG CONSERVATIVE MUCHACHOS CHANGE BUSINESS TRADE FISCAL GOVERA GOVERNMENT MONETARY INVESTMENT FINANCIAL PROPERTY CORRUPTION LABOR MOSTLY UNFREE MODERATELY FREE MOSTLY FREE BY ΥEAR OVERALL SCORE