Hong Kong crowned world’s freest economy again in Canada’s Fraser Institute rankings, but group warns result doesn’t show ‘China’s interference’
- City’s rating fell by ‘stunning’ 0.28 points, with think tank noting decline was much larger than world average
- City government welcomes ranking, but hits out at ‘unfair’ comments
Hong Kong has been ranked the world’s freest economy again by a Canadian think tank, but the group warned the latest annual result did not reflect “interference from China” on the city’s rule of law over the past two years.
The Fraser Institute, an independent public policy research and educational organisation, crowned Hong Kong – followed by Singapore – among free economies in the 2022 edition of its report titled “Economic Freedom of the World”, released on Thursday. But the city’s rating fell by 0.28 points.
The next highest-scoring nations are Switzerland, New Zealand, Denmark, Australia, United States, Estonia, Mauritius and Ireland.
Hong Kong ranked world’s freest economy yet again, but not for long, group warns
China was ranked 116th, the same as in the previous edition.
Hong Kong has mostly topped the list since the report was first launched in 1996.
In the latest rankings, Hong Kong’s overall rating fell by “a stunning” 0.28 points to 8.59 for 2020, from 8.87 in 2019, according to the report.
The think tank noted it was difficult to discern how much of the drop was related to China’s “economic and political crackdown” in the city or the impact of the coronavirus pandemic.
But it added: “We do note that Hong Kong’s decline was much larger than the world’s average decline. It seems reasonable to assume that much of this decline was related to China’s new harsh policies in Hong Kong and is not entirely the fault of the pandemic policies.”
“Hong Kong remains the most economically free jurisdiction in the world, but this ranking is based on 2020 data and more recent interference from China threatens to undermine Hong Kong’s rule of law, which helps ensure equal freedom for all,” Fred McMahon, the institute’s Dr Michael A. Walker research chair in economic freedom, said in a press release on Thursday.
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In the institute’s previous report last year, it also noted that the city’s rating at the time did not reflect the impact of the national security law, imposed by Beijing on June 30, 2020, which prohibits secession, subversion of state power, terrorism and foreign interference. The researchers also predicted the central government’s actions were likely to have a negative impact on Hong Kong’s score going forward, especially with regards to the city’s legal system.
The institute measures the economic freedom of 165 jurisdictions based on factors such as levels of personal choice, ability to enter markets, security of privately owned property and rule of law. The 2022 report was based on data in 2020, the latest available.
While the Hong Kong government welcomed the ranking, a spokesman hit out at the institute’s “unfair” comments on the rule of law and China interference.
A spokesman on Thursday said that since the city returned to Chinese rule, it had been implementing the “one country, two systems” principle in strict accordance with the Basic Law, the mini-constitution, and various rights and freedoms had been fully protected.
He added that the success of the system had won recognition worldwide.
With the implementation of the security law, stability and safety had been swiftly and effectively restored in society, the spokesman said, insisting Hong Kong’s prestigious business environment had returned.
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Citing the value of Hong Kong’s asset and wealth management sector having reached HK$35.5 trillion (US$4.5 trillion) at the end of 2021, with an increase of more than 20 per cent from the end of 2019, the spokesman noted that after more than two years under the security law, the data indicated investors’ confidence had been reinforced following the stabilisation of society.
The amount of deposits in the banking system also stood at more than HK$15 trillion in July this year, 8.5 per cent higher than before the law came into force, according to the Hong Kong administration.
“We reiterate that the rule of law is a fundamental core value of the HKSAR and the bedrock for its success, which is widely accepted and respected by the community. Under ‘one country, two systems’, the city has maintained and kept developing its original legal system including the common law,” the spokesman said.
