Last week, The Heritage Foundation’s Economic Freedom Task Force published its 2014 Global Agenda for Economic Freedom.
In it the task force identifies obstacles to expanding economic freedom, policies that regional governments should implement, and 27 concrete recommendations for U.S. actions to help promote economic liberty.
The Global Agenda looks at a world confronted, from Venezuela to Ukraine, with real and tangible threats—the most significant since the end of the Cold War—and warns that the promotion of economic freedom at home and abroad has become essential not only for the revitalization of the U.S. economy but also for U.S. national security.
The report notes that too many Middle East countries are still dominated by corrupt, authoritarian regimes looking out for themselves—not their citizens. Despite the “Arab Spring,” that region still needs much more economic freedom. The Global Agenda also finds that corruption is one of the major obstacles holding back economic growth and freedom in sub-Saharan Africa.
That’s the case, too, in Russia and many of its neighbors that are plagued by mismanagement, corruption, abysmal rule of law, poor protection of property rights, and crumbling infrastructure. In Russia, capital flight exceeds inflows of foreign direct investment. No wonder Vladimir Putin would rather change the subject and distract people with his foreign adventurism! The report urges Russia’s neighbors (like Ukraine) to pull away from Putin’s Eurasian Customs Union, a retrograde structure that serves only the interests of Russia.
The picture is a little brighter in Latin America, where, as the Global Agenda notes, many Latin American countries are emerging as global leaders in free trade. The Pacific Alliance (Mexico, Colombia, Peru, and Chile, along with potential members Costa Rica and Panama) emerged as a praiseworthy model of regional economic integration that will enhance prosperity.
However, the report also notes the polarizing legacy of Venezuelan president Hugo Chavez and his “21st-century socialism” Bolivarian Alliance (ALBA) model. Led by populist authoritarian caudillos (strongmen), the ALBA countries of Venezuela, Ecuador, Nicaragua, and Bolivia have been transformed into welfare dependencies where the rule of law has eroded.
The best news in the 2014 Global Agenda comes from the Asia–Pacific, with the greatest gains in economic freedom through better-than-average scores in fiscal freedom, government spending, and labor freedom. The region still ranks poorly in property rights, freedom from corruption, and financial and investment freedom. And while it has four of the world’s freest economies—Hong Kong, Singapore, Australia, and New Zealand—many others remain “mostly unfree.”
If free markets are allowed to reign in the region, that could promote an Asian Century: Home to 60 percent of the world’s population, Asia saw its share of world gross domestic product rise from 24 percent in 2000 to 34 percent in 2013. Asia emerged from the global financial crisis with its standing strengthened and is expected to become the largest economic region within the next two decades.