Việt Nam moves up significantly in economic freedom ranking while global average falls

A fish market in Ninh Thuận Province. Việt Nam's ranking of economic freedom by the US's Heritage Foundation has improved significantly. — VNA/VNS Photo Nguyễn Thành

Việt Nam has climbed 13 places from last year to rank 59th out of 176 countries and territories worldwide in the index of economic freedom by the US’ Heritage Foundation.

First published in 1995, the rankings found that Singapore has maintained its status as the world’s freest economy with an overall score of 83.5, demonstrating a high level of economic resilience.

Switzerland is the world’s second freest economy with a score of 83, followed by Ireland (82.6), and Taiwan (80).

Việt Nam earns an overall score of 62.8.

Especially notable is the continuing decline within the “mostly free” category of the United States, whose score plummeted to 70.1, its lowest level ever in the 30-year history of the Index. The US is now the world’s 25th freest economy. The major causative factor in the erosion of America’s economic freedom is excessive government spending, which has resulted in mounting deficit and debt burdens, according to the report.

Both New Zealand and Australia have lost their top-tier economic freedom status, with Australia no longer among the world’s 10 freest economies.

“While the state of economic freedom in the world has, according to the Heritage Foundation, fallen to the lowest level since 2001 and the US has its worst rating since the index was first compiled in 1995, Việt Nam has bucked the global trend and improved greatly,” Rainer Zitelmann, author of bell-selling books including Dare to be Different and Grow Rich, wrote in a publication in Townhall.com.

“Việt Nam is catching up in leaps and bounds…In a long-term comparison since 1995, Việt Nam has gained 21 scores more than any other country of comparable size in the world.”

Pointing out that the starting point for the changes in Việt Nam was the Đổi Mới (Renewal) starting in 1986, he said that Việt Nam had the chance to become one of Asia’s leading economic nations if the country continues on the path of market economy reforms.

The index measures 12 aspects of economic freedom which can be grouped into four pillars including rule of law (property rights, judicial effectiveness, and government integrity), government size (tax burden, government spending, and fiscal health), regulatory efficiency (business freedom, labour freedom, and monetary freedom), and market openness (trade freedom, investment freedom, and financial freedom).

The global average score for economic freedom has fallen further from the previous year’s 59.3 and is now the lowest it has been since 2001: only 58.6.

Only four countries (down from seven in the 2022 Index) recorded economic freedom scores of 80 or more, putting them in the ranks of the economically “free;” 22 countries earned a designation of “mostly free” by recording scores of 70.0 to 79.9; and an additional 55 countries were considered at least “moderately free” with scores of 60.0 to 69.9.