Bulgaria Ranks 36th in Frasers's 2021 Economic Freedom of the World Annual Report

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15.09.2021 / 10:21

Bulgaria ranks 36th among 165 countries and territories in Frasers's 2021 Economic Freedom of the World Annual Report, losing four positions from last year, said Tuesday the Institute for Market Economics (IME) which is the local partner of Fraser Institute.

A year earlier Bulgaria was 32nd in the ranking.

Fraser Institute's Economic Freedom of the World Report measures economic freedom, ranking countries based on five areas: size of government, legal structure and security of property rights, access to sound money, freedom to trade internationally, and regulation of credit, labour and business. The countries are rated on a scale of 0 to 10, 10 being the maximum economic freedom.

This year's report is based on data from 2019, the latest globally comparable data.

Yet again Hong Kong and Singapore top the ranking.

Bulgaria's score reached 7.76, up from last year's 7.74, but the country still slips four positions in the ranking. From 1990 to 2005, Bulgaria's economic freedom grew relatively fast because of its low starting level, but little progress was made in the last 10 to 15 years, IME says.

In the area of size of government, Bulgaria's score is 7.02, deteriorating over the last few years, because of vast government expenses and high levels of budget transfers and grants. Meanwhile, Bulgaria receives a maximum score for its income tax rate and flat tax system. Colombia, Malta, the Republic of South Africa, Ukraine and Malaysia are in a similar position.

In the area of legal structure and security of property rights, Bulgaria's score is 5.94. There is lack of progress in this area, which has been traditionally the weakest for this country. The score is low, especially for impartial courts, reliability of police and protection of property rights. In terms of this, Bulgaria sits next to Butan, Jamaica, Mongolia, Greece and Malaysia.

In the area of access to sound money, Bulgaria's score is 9.66 - its best in years. The analysts say that the currency board keeps stable the national currency, the lev. but higher inflation rate in 2019 prevented this country from doing even better. Canada, Indonesia, Paraguay, Armenia and Great Britain are in a similar position.

In the area of freedom to trade internationally, Bulgaria's score is relatively high (8.38), due to its European Union membership. Belgium, Czech Republic, Great Britain, Slovakia and Spain have similar rating.

In the area of credit market regulation, Bulgaria's score is relatively high, at 7.81. The business regulations score remains relatively low, mainly because of the massive administrative requirements for companies. The credit market regulations score stays high, with many banks and free lending.

Stringent requirements for hiring and firing workers, the minimum wage and working time are impacting negatively the labour market regulations score. Alongside Bulgaria in this department are Armenia, Mongolia, Rwanda, Slovakia and Italy./BTA

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