Economic freedom in SA a long way off

South Africa ranked 69th out of 123 countries in an index measuring human freedom. The index, said to be the most comprehensive ever, was compiled by two leading international think-tanks – the Fraser Institute in Canada and the Liberales Institut in Germany.


The index does not measure the levels of democracy or political freedom, but combined economic freedom measures from the Economic Freedom of the World (EFW) index, which measures of civil or personal freedoms, such as freedom of speech, religion, individual economic choice and freedom of association.


According to the index, New Zealand leads the world in human freedom, followed by the Netherlands and Hong Kong. The US came seventh and China ranked 100th. Zimbabwe came last.


Although South Africa reached third place in Sub-Saharan Africa, on the continent it trailed other African countries, such as Mauritius (30th place), Ghana (55) and Namibia (62). With regard to economic freedom countries such as Zambia, Uganda and Botswana also beat South Africa.


“We’ve gained a lot of economic freedom since 1994,” Free Market Foundation CEO Leon Louw says, “but we’ve slipped since 2005 while the rest of Africa is moving up.” He blames the constriction of economic freedom on too much Government interference in the economy. “We’ve chased away global industries which have decided to take their business to other African countries.”


Louw cites the national carrier SAA and Eskom as examples. “With excessive interference in the airlines and energy industries, Government is busy destroying what works and neglects what doesn’t work.” According to him “all advanced countries” have privatised their airlines, while the South African Government is clinging to SAA. “The same with Eskom,” he says. “Other countries don’t have public power utilities any longer, but we sit with this giant dinosaur (Eskom).”


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