2010 Index of Economic Freedom

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.
The 2010 Index of Economic Freedom covers 183 countries around the world, ranking 179 of them with an economic freedom score based on 10 measures of economic openness, regulatory efficiency, the rule of law, and competitiveness. The basic principles of economic freedom emphasized in the Index are individual empowerment, equitable treatment, and the promotion of competition.
Mauritius a tiny island off the Southeast coast  of African Continent ranked the freest economy in the Sub-Saharan Africa region. According to the report, “Mauritius recorded impressive progress and is now ranked as the world’s 12th freest economy.” With 76.3 overall score, Mauritius is ranked just below the United Kingdom and not too far from the United States. From Africa, Mauritius is followed by Botswana, South Africa and Uganda.
Economic freedom improves the overall quality of life, promotes political and social progress, and supports environmental protection. The 2010 Index provides strong evidence that economic freedom has far- reaching positive impacts on various aspects of human development. Economic freedom correlates with poverty reduction, a variety of desir- able social indicators, democratic governance, and environmental sustainability.

Quick Facts

Population:  80.7 million
  • $70.1 billion
  • 11.3% growth
  • 11.8% 5-year compound annual growth
  • $868 per capita
Unemployment: Inflation (CPI):  25.3% FDI Inflow: $93.0 million

Ethiopia’s economic freedom score is 51.2, making its economy the 136th freest in the 2010 Index. Its overall score fell 1.8 points as a result of deteriorating trade freedom, monetary freedom, and investment freedom. Ethiopia is ranked 28th out of 46 countries in the Sub-Saharan Africa region, and its overall score is just below the regional average.

Ethiopia has achieved considerable economic growth over the past five years, driven mainly by exports of agricultural products. The double-digit growth rate of over 10 percent, however, is fragile due to the lack of economic dynamism, and the economy remains highly vulnerable to external shocks. Progress toward greater economic freedom has been uneven and sluggish.

Ethiopia underperforms in many of the 10 economic freedoms. The business and investment regime is burdensome and opaque. The overall quality and efficiency of government services have been poor and are further undermined by weak rule of law and pervasive corruption. Monetary stability is hampered by state distortions in prices and interest rates, and trade freedom is hurt by high tariff and non-tariff barriers.

Full Report : The Heritage Foundation – Information on Ethiopia’s Economic Freedom or Download PDF



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