Tuesday January 18, 2022

Pakistan scores low in world economic freedom report 2021

October 13, 2021
Pakistan scores low in world economic freedom report 2021

ISLAMABAD: Fraser Institute’s annual Economic Freedom of the World 2021 report showed Pakistan scored 5.95 out of 10 in terms of economic freedom and lay at the bottom quartile, an illustration that the country was not economically free.

This year ranked Pakistan at 142nd based on 2019 data, the most recent comprehensive data.

The country has showing a downward trend since 2016. Last year, Pakistan ranked 133rd with a score of 6.07, the report showed.

Fred McMahon, Dr Michael A Walker Research Chair in Economic Freedom at the Fraser Institute, said, “Due to higher taxes and increased regulation in Pakistan, people are less economically free, which means slower economic growth and less investment in the country.”

PRIME Institute Executive Director Ali Salman said, “Pakistan is not economically free.

This is not a secret. There is a possible relationship between our economic constraints with the restrictions we impose on our individuals and enterprises. Fraser’s report points to some of these restrictions.”

The report, which was first launched in 1996, measures economic freedom—the ability of individuals to make their own economic decisions—by analysing the policies and institutions of 165 countries and territories. Indicators include regulation, freedom to trade internationally, size of government, property rights, government spending and taxation.

People living in countries with high levels of economic freedom enjoy greater prosperity, more political and civil liberties, and longer lives.

For example, countries in the top quartile of economic freedom had an average per-capita GDP of $50,619 in 2019, compared to $5,911 for bottom quartile countries, and $1,284 for Pakistan.

And poverty rates were lower. In the top quartile, 0.9 percent of the population experienced extreme poverty ($1.90 a day) compared to 34.1 percent in the lowest quartile.

Finally, life expectancy is 81.1 years in the top quartile of countries compared to 65.9 years in the bottom quartile, and 67 years in Pakistan.

Pakistan achieved physical security by investing in nuclear capability. We need economic security by investing in our people and institutions and by disinvesting the state from areas where it is not needed. This is the essence of economic freedom.

The Fraser Institute produces the annual Economic Freedom of the world report in cooperation with the Economic Freedom Network, a group of independent research and educational institutes in nearly 100 countries and territories, including PRIME Institute in Pakistan. It is the world’s premier measurement of economic freedom.