NEW YORK—Armenia is ranked 18th among 43 countries in the Europe region in the 2014 Index of Economic Freedom released by the Wall Street Journal and the Heritage Foundation.
According to the report, Armenia’s “economic freedom score” is 68.9, making its economy the 41st freest in the world in the 2014 Index. Its overall score has declined by half a point from last year, primarily due to combined deteriorations in investment freedom, business freedom, and fiscal freedom.
Armenia is ranked 18th among the 43 countries in the Europe region, and its score is above the world and regional averages.
Over the 20-year history of the Index, Armenia has improved its economic freedom score by 26.7 points, the fourth largest score increase. Recording score improvements in eight out of 10 economic freedoms, including monetary freedom, management of public finances, trade freedom, and financial freedom, Armenia has advanced from “economic repression” 20 years ago to economically “moderately free” today. Facilitated by the broad advancement of economic freedoms, the diversification of the country’s economic base has enhanced Armenia’s economic dynamism and reduced poverty, according to the report.
Nonetheless, substantial challenges remain, the report says, particularly in implementing deeper institutional and systemic reforms that are critical to strengthening the foundations of economic freedom. Both the protection of property rights and freedom from corruption are far below world standards, and the legal framework continues to be weak.
For 20 years the Heritage Foundation, in partnership with The Wall Street Journal, has tracked the state of economic freedom around the world with the influential Index of Economic Freedom based on 10 quantitative and qualitative factors, grouped into four broad categories, or pillars, of economic freedom: Rule of Law (property rights, freedom from corruption); Limited Government (fiscal freedom, government spending); Regulatory Efficiency (business freedom, labor freedom, monetary freedom); and Open Markets (trade freedom, investment freedom, financial freedom).
Armenia’s neighboring countries and Customs Union member states are ranked as follows: Georgia, 22nd; Iran, 173rd; Azerbaijan, 81st; Turkey, 64th; Russia, 140th; Belarus, 150th; and Kazakhstan, 67th.