Index of Economic Freedom 2013 The Heritage Foundation, together with the Wall Street Journal, has released its annual Index of Economic Freedom, which covers 185 countries and scores countries on 10 freedoms identified by the foundation: labor freedom, business freedom, trade freedom, fiscal freedom, government spending, monetary freedom, investment freedom, financial freedom, property rights and freedom from corruption. The Index measures ten components, using a scale from 0 to 100, where 100 represents the maximum freedom. "For analytical understanding and presentational clarity, the 10 economic freedoms are 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)."
According to Ambassador Terry Miller, Director of the Center for International Trade and Economics (CITE) and Mark A. Kolokotrones Fellow in Economic Freedom at The Heritage Foundation, "The foundations of economic freedom are weakening around the world..." Thailand's global rank now stands at 61. Within the Asia-Pacific region, which continues to hold the Index's top 4 scores globally, Thailand is once again ranked 10th out of 41 countries; 3rd among ASEAN. The region also includes some of the lowest ranking countries, which gives it an average of 57.4 in comparison to a global average of 59.6. The Heritage Foundation notes that "recent reforms have improved regulatory efficiency" and that "the financial system has undergone restructuring in recent years. Capital markets are relatively well developed and dynamic." And yet, with a score of 64.1 there is room for improvement, which is something the government is open to and continues to address. Thailand continues to receive an overall 83.7 ranking for government spending, as well as 78.9 for fiscal freedom. The Index lists Thailand's corporate income tax rate as being 23 percent, although this rate dropped to 20% beginning on January 1st of this year. In several other areas as well Thailand achieved high marks, such as in business freedom, 73.2, labor freedom, 72.9, trade freedom, 75.2, and financial freedom, 70.0.
Thailand continues to work to improve its economic freedom, which has become especially important as the integration of global economies becomes more widespread. Thailand already has one of the most competitive corporate income tax rates in Asia; it has one of the regions better ranked economies for economic freedom and continues to be highly ranked by other bodies such as UNCTAD and the World Bank. The improvements being made in the run-up to the formation of the ASEAN Economic Community should prove to be beneficial to the country's future rankings and to investors today and well into the future.