Economic Freedom of the Arab World: 2014 Annual Report

Economic freedom provides a path to a better, more prosperous, more stable, and freer tomorrow for the Arab world. Economic freedom is simply the ability of individuals and families to take charge of their fate and make their own economic decisions—to sell or buy in the marketplace without discrimination; to open or close a business, to work for whom they wish or hire whom they wish, to receive investment or invest in others.

Economic freedom has a proven fact-based record in improving the lives of people, liberating them from dependence and leading to other freedoms and democracy. The Index uses 39 variables, all from third party sources to ensure objectivity, to measure economic freedom in the Arab world.  We are able to rank 20 out of the 22 members of the Arab League.

This is the tenth report on economic freedom in the Arab world. The first was published in the Arab World Competitiveness Report 2005 (Lopez-Claros and Schwab, 2005). The second and subsequent editions were published by the International Research Foundation (IRF) of Oman and the Fraser Institute. In 2008, the Friedrich Naumann Foundation for Liberty, Cairo office, also became a co-publisher. Economic Freedom of the Arab World has gathered more attention every year since it was first published. Its importance comes from being a tool to measure how economically free Arab countries are.

The 2014 index adds data for 2012, the most recent year for which full data are available. Looking forward, we also present some early data for 2013 in both the country tables and the country summaries. As well, the scores for previous years have been re-calculated using revised data from the World Bank for its Doing Business and World Development Indicators databases. Economic Freedom of the Arab World is modelled on the annual reports in the series, Economic Freedom of the World.

Overview of scores and ranking
The Hashemite Kingdom of Jordan and the United Arab Emirates narrowly topped the list of the most economically free nations in the Arab world with scores of 8.1. Bahrain came third with a score of 8.0. In fourth place came the State of Kuwait with a score of 7.8, keeping the same position as last year. Oman and Qatar tied for fifth place with scores of 7.7.

The bottom five nations are Algeria, the least economically free nation in the Arab world, a position it has held for several years, with a score of 5.6; Iraq, 5.7; Syria, 5.8; Sudan, 5.9; and Libya, 6.0. As noted earlier, however, the scores for nations suffering significant internal conflict should be treated cautiously.