Economic freedom

Cyprus has been included among the top 20 spots in an international list of countries considered to enjoy significant levels of economic freedom.

More specifically, in the 18th position on the list, Cyprus falls in the ‘Mostly Free’ category of the 2023 Index of Economic Freedom.

The Index of Economic Freedom is an annual index and ranking created in 1995 by The Heritage Foundation and The Wall Street Journal to measure the degree of economic freedom in the world's nations. The Heritage Foundation is an activist US conservative think tank based in Washington, D.C.

According to the Heritage Foundation, it considers Economic freedom as being "the fundamental right of every human to control his or her own labor and property. In an economically free society, individuals are free to work, produce, consume, and invest in any way they please. In economically free societies, governments allow labor, capital, and goods to move freely, and refrain from coercion or constraint of liberty beyond the extent necessary to protect and maintain liberty itself."

The Index’s comments on Cyprus note that, “Cyprus’s economic freedom score is 72.3, making its economy the 18th freest in the 2023 Index. Its score is 0.6 point worse than last year. Cyprus is ranked 12th out of 44 countries in the Europe region, and its overall score is above the world and regional averages.”

“Particularly compared to other developing economies, the sound foundations of economic freedom in Cyprus are sustained by a generally well-functioning judicial system. Although public debt is moderate compared to that of other European economies, growing public spending is eroding respect for the principle of limited government and limiting Cyprus’s overall economic freedom,” it goes on to comment.

The Index indicates that Cyprus’ scores for Tax Burden, Government Spending and Fiscal Health as well as for Labour Freedom improved compared to the previous year, while scores for Property Rights, Judicial Effectiveness, Government Integrity, Monetary Freedom and Trade Freedom fell. The scores for Business Freedom, Investment Freedom and Financial Freedom stayed the same. Click here to see the information on Cyprus.

Topping this year’s Index of Economic Freedom is Singapore, followed by Switzerland, Ireland and Taiwan, with the four countries in the ‘Free’ category.

Cyprus falls in the next, ‘Mostly Free’ category, which is topped by New Zealand in fifth place overall.

Rounding out the top 10 are Estonia, Luxembourg, Netherlands, Denmark and Sweden. In 18th place, Cyprus comes below Latvia and ahead of Iceland.

The US is also in this same category, but in 25th place while the UK tops the list in the next category, regarded as ‘Moderately Free’ and in 28th place overall.

Greece is in the ‘Mostly Unfree’ category and 107th place overall, behind the Solomon Islands and ahead of Kuwait.

North Korea is at the bottom of the list in 176th place and at the tail end of the ‘Repressed’ category.

Eight countries were not ranked, namely Afghanistan, Iraq, Libya, Liechtenstein, Somalia, Syria, Ukraine and Yemen.