Kazakhstan moved up one position in the new 2018 Index of Economic Freedom, reaching 41st place. Kazakhstan’s economy surpassed regional and global averages and was ranked the highest in Central Asia and among the Commonwealth of Independent States (CIS).
Hong Kong was, as in 2017, recognised as the freest economy of the 180 examined in the Heritage Foundation’s rankings. Singapore took second place, New Zealand third. Switzerland, Australia, Ireland, Estonia, the United Kingdom, Canada and the United Arab Emirates were among the top 10. The United States ranked 18th, China 110th.
Kazakhstan’s economy was given a freedom score of 69.1 out of a maximum of 100 points.
“Its overall score has increased by 0.1 point, with significant improvements in investment freedom and government integrity offsetting steep declines in fiscal health and monetary freedom,” the report explained. “Kazakhstan is ranked 11th among 43 countries in the Asia-Pacific region, and its overall score is above the regional and world averages.”
Other high-ranking CIS countries are Armenia at 44th, Azerbaijan at 67th and Kyrgyzstan at 78th. Moldova’s economy came in 105th, Tajikistan’s 106th, Russia’s 107th and Belarus’s at 108th. Ukraine was ranked 150th, Uzbekistan 152nd and Turkmenistan 169th.
The index, launched in 1995, evaluates countries on aspects affecting economic freedom, which it defines as rule of law, government size, regulatory efficiency and open markets. Countries scoring 80 or higher are classified as “free.” Countries scoring 70-79.9 are “mostly free,” 60-69.9 “moderately free,” 50-59.9 “mostly un free” and under 50 “repressed.”
Kazakhstan, falls within the “moderately free” group, and sits below Jamaica at 40th and above Colombia which comes in at 42nd.
Although the index found many overall improvements in Kazakhstan, the report also had some criticisms.
“Kazakhstan’s government is well aware that the economy is overly reliant on oil and extractive industries, but initial attempts to open up sectors such as transport, pharmaceuticals, telecommunications, petrochemicals, and food processing to greater development and investment have been uneven.”, said the report.
“Secured interests in property are recognised in law. Although the government has improved the enforcement of contracts and has simplified property registration, property rights are not fully protected. Judges are subject to political bias. Corruption is not only evident in the judicial system, but also widespread throughout the government. Those who are in positions of authority are able to act with impunity,” reads the report.
Government size is assessed through government spending (where Kazakhstan scored 85.3 points), tax burden (92.6) and fiscal health (87.3).
Kazakhstan scored well in regulatory efficiency, as measured by business freedoms (74.3), labour freedoms (86.8) and monetary freedoms (68.2). The report noted the country’s simplified procedures for starting a business, dealing with construction permits and getting electricity, as well as stronger minority investor protections and enforcement of contracts.
Regarding open markets, Kazakhstan’s trade freedom scored 75.6 points, while investment and financial freedom got 50.