01/17/2008, 00.00
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Hong Kong has the "freest" economy in the world

A study by American experts of the prestigious Wall Street Journal give Hong Kong top honours for the fourteenth year in a row. Singapore, Australia, the United States, Switzerland, Great Britain, and Japan are doing well, while the Chinese economy is "mostly unfree".

Hong Kong (AsiaNews/Agencies) - Hong Kong has "the freest economy in the world", according to the estimates of the Heritage Foundation in Washington and the prestigious economic newspaper The Wall Street Journal. It is judged the leader for the fourteenth year in a row, but the gap with second-place Singapore is narrowing.

The study considered 157 economies from July 1, 2006 to June 30, 2007, on the basis of 10 economic factors (like free trade, taxes, investment, corruption), attributing a score from 0 to 100 to create an index of economic freedom. Hong Kong scored 90.3 points, lower than its 90.6 points in 2007, but ahead of Singapore, which scored 87.4. They are followed by Ireland, Australia, and the United States, while Switzerland is ninth and Great Britain tenth. Japan is in 17th place, and Taiwan at number 27.

But Terry Miller, director of the Heritage Foundation's Centre for International Trade and Economics, says Hong Kong "does drop a bit in monetary freedom because of the small increase in inflation rates". "Singapore", he continues, "actually scores better than Hong Kong in five of the 10 areas", but fell behind in government control of the banking sector.

To create a freer market, the authors of the study recommend lowering taxes, and avoiding minimum wage and competition laws. According to Mary Kissel, an editorialist for the Wall Street Journal, Hong Kong could lose points if it introduces the minimum wage or price controls.

John Tsang Chun-wah, Hong Kong's finance secretary, said that the government is determined to maintain its position of leadership and to "provide a business-friendly environment and an appropriate regulatory regime for a free market".

China is in 126th place, among the "mostly unfree" countries, with just half a point more than Uzbekistan and one point over Russia. Especially burdensome are high levels of corruption (thought to be on the increase), the absence of protection for property rights, and lack of freedom in the sectors of finance and investment.

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