Government is strangling economic freedom by interfering in the economy – research

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THANDI XABA

 

The Economic Freedom of the World report indicates that South Africa has dropped by 54 places since the year 2000 in economic freedom.

The report, compiled by the Free Market Foundation in conjunction with Canada's Fraser Institute, placed South Africa 96th among the over 100 countries reviewed. Eustace Bavie from the Free Market Foundation says that South Africa's current economic problems could be alleviated by allowing businesses to invest more in the economy, instead of having to spend money on governing.

He adds that there are other former communist countries, that have now moved above SA in the ranking.

"South Africa has declined from 89 to 96 in a year, but going back to year 2000, it was 42nd in the world meaning it dropped by 54 places, but it is not all related to a decline in the rating, there are other countries that have moved above South Africa in the ranking, many of them have actually gone all out to be more economically free," he says.

Furthermore economists say the country is slipping in the rankings because of the increase in regulation, taxes and labour instability, which are all strangling the economy.