Georgia’s Score on the Economic Freedom Index Has Worsened
Georgia lost the most points in the category regarding the effectiveness of the judicial system.
In the 2019 Index of Economic Freedom published by the Heritage Foundation, Georgia came in 16th place among 186 countries around the world. Georgia’s position compared to the previous year has not changed.
Georgia’s score is 75.9, which means that the score has gone down by 0.3 points.
According to the report, countries are assessed against four main criteria: rule of law, size of government, effectiveness of regulations, and the free market.
The rule of law combines the following variables: protection of the right to property, government integration, effectiveness of the justice system. The score for Georgia has worsened in these criteria specifically.
The report points out that political pressure puts the freedom of justice system at risk. In addition, Georgia contributed majorly to defeating corruption but instances of corruption among high ranking public servants remains a problem.
Under the size of the governmentcriterion, Georgia’s score improved under all sub-categories. The sub-categories include government spending, fiscal health, and tax.
With regard to the effectiveness of the regulations criterion, in this case Georgia’s score has worsened. The score went down in the categories of workforce and monetary freedom and freedom of business criteria.
The Heritage Foundations mentions that Georgia has a liberal economic policy; only two days and two procedures are needed to start a business. In addition, there is no requirement for minimum capital. However, the employment market is missing dynamism.
Under the free market sub-categories, investment in terms of freedom in Georgia remains unchanged. The financial freedom score has improved, coming to 70 points. The report says that Georgia has imposed certain restrictions on foreign citizens owning land. The banking sector is developing in the country, however the stock exchange and the capital market are still weak.
In total, Georgia’s score is higher than the global average (60.8), however, over the past three years Georgia scored the worst in the 2019 rating. To be specific, this year Georgia’s score is 75.9, in 2018 it was 76.2, and in 2017 it was 76.
In this year’s ratings, the score was lowered mostly due to the effectiveness of the justice system coming to 54.6 (-9.6 points). The biggest improvement was shown in the country’s financial freedom, +10 coming to 70 points.
Among the countries in the region, totaling 44 countries, Georgia is in 8th place.
This year, Hong Kong holds first place, followed by Singapore and New Zealand.