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  • Africa: Little Change in Economic Freedom

    Africa’s progress in Heritage’s 2013 Index of Economic Freedom remains stagnant. Though making progress last year, with an average score gain of 0.2 points, the continent declined by 0.1 points in 2013.

    Over the past few years, scores of Western nations have seen their ratings plummet (including the United States). Africa, however, has made noticeable progress. In 2012, Africa’s growth rate was 5.3 percent and is projected to be 5.6 percent in 2013. While these numbers imply progress for the continent as a whole, the countries that make up Africa are diverse and vary in their levels of economic freedom.

    For example, the small island nation of Mauritius (#8) was the first African country to break into the top 10 rankings in 2012. While Mauritius maintained its ranking this year, it dropped 0.1 points in its overall economic freedom score.

    Botswana, on the other hand, ranked #33 in 2012, improved its score this year, ranking #30.

    Read more about Botswana Economy. See more from the 2013 Index.

    Both Botswana and Mauritius fall into the category of “moderately free.” However, nearly half of the African countries scored are “mostly unfree.” Furthermore, over a third of the African countries scored are “repressed.”

    Poor rule of law, lack of property rights, high levels of corruption, and restrictions on labor freedom remain barriers to economic advancement.

    South Africa (#74), the continent’s largest economy, suffers from nationalization, land seizures, and state intervention, thus reducing its overall score.

    Nigeria’s (#120) economy may have grown 7 percent over the past five years, but this has not translated into a freer economy. Nigeria’s dependence on its oil industry has hamstrung diversification. Furthermore, Nigeria’s rule of law is particularly weak, with corruption as the overarching challenge.

    Countries such as Eritrea (#173) and Zimbabwe (#175) scored only slightly better than Cuba (#176) and North Korea (#177). It’s no coincidence that they are governed by some of the world’s most repressive regimes.

    Between 2010 and 2011, no region made greater strides in economic freedom than Africa. However, that progress has halted. Moving forward, as Africans hold their leaders accountable for good governance, their rewards will come in the form of economic opportunities. For a continent that has struggled for decades with instability, economic reforms will be gradual. It would be a shame for such momentum to stall.

    Posted in Economics [slideshow_deploy]

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