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For Immediate Release
Contacts: Jim Weidman, (202) 675-1761, [email protected]
Colleen Schwartz, (212) 416-3583, [email protected]
WASHINGTON, FEB. 1, 2016—The South and Central America/Caribbean
region again became less economically free last year, making it one of three regions to post a
loss in the 2016 Index of Economic Freedom, published by The Wall Street Journal and The
Heritage Foundation.
The region remains one of the world’s most diverse, economically as well as politically.
This year, 12 of the 29 countries in the region recorded better scores in the Index, while 16
countries charted declines (and one, Dominican Republic, stayed the same).
“The stark common reality across the region is that the foundations of well-functioning
free-market democracy remain fragile,” the editors write. “With widespread corruption and the
weak protection of property rights aggravating systemic shortcomings such as regulatory
inefficiency and monetary instability caused by various market distortions, the region as a whole
has become increasingly vulnerable to deceptive models of populist governance.”
Launched in 1995, the Index evaluates countries in four broad policy areas that affect
economic freedom: rule of law; limited government; regulatory efficiency; and open markets.
There are 10 specific categories: property rights, freedom from corruption, fiscal freedom,
government spending, business freedom, labor freedom, monetary freedom, trade freedom,
investment freedom, and financial freedom. Scores in these categories are averaged to create an
overall score.
No economy in South and Central America/Caribbean ranks as “free”, but four “mostly
free” economies lead the region: Chile, Saint Lucia, Colombia and Bahamas, whose regionalbest improvement of 2.2 points raised it to that category for the first time. Thirteen economies
fall into the “moderately free” category, seven are “mostly unfree,” and five are “repressed”:
Ecuador, Bolivia, Argentina, Venezuela and Cuba.
Chile remains the regional leader, but several policies threaten its well-established
tradition of economic freedom. “Along with the introduction of redistributive tax measures, the
corporate tax rate has been raised and is slated to rise further in coming years,” the editors write.
“Ongoing labor reforms have focused on increasing the minimum wage and strengthening union
At the other end of the scale, Argentina—hampered by what the editors call a “blatant
disregard for the basic foundations of the rule of law and limited government”—recorded its
lowest Index score ever. And in Venezuela, President Nicolás Maduro has pushed government
spending to the brink, resulting in harmful increases in inflation and public debt.
The world average score of 60.7 is the highest recorded in the 22-year history of the
Index. Thirty-two countries, including Burma, Germany, India, Israel, Lithuania, the
Philippines, Poland and Vietnam, achieved their highest-ever Index scores. Among the 178
countries ranked, scores improved for 97 countries and declined for 74. Over the period covered
by the 2016 Index (mid-2014 to mid-2015), scores improved in half of the freedoms measured by
the Index editors, most notably in investment freedom.
The 2016 Index was edited by Ambassador Terry Miller, director of Heritage’s Center for
Trade and Economics and Center for Data Analysis; and Anthony B. Kim, research manager and
senior policy analyst in the Center for Trade and Economics. Copies of the Index (484 pages,
$24.95) may be ordered online at or by calling 1-800-975-8625. The full
text, including charts and graphs, also is available online.
About The Heritage Foundation
The Heritage Foundation is the nation’s most broadly supported public policy research institute, with hundreds of
thousands of individual, foundation and corporate donors. Founded in 1973, Heritage develops public policy
solutions that advance free enterprise, limited government, individual freedom, traditional values and a strong
national defense.
About The Wall Street Journal
The Wall Street Journal is a global news organization that provides leading news, information, commentary and
analysis. Published by Dow Jones, The Wall Street Journal engages readers across print, digital, mobile, social, and
video. Building on its heritage as the preeminent source of global business and financial news, the Journal includes
coverage of U.S. & world news, politics, arts, culture, lifestyle, sports, and health. It holds 36 Pulitzer Prizes for
outstanding journalism.