Vietnam rises 15 places in freest economies list

Women sell vegetables at a Hanoi market in January, 2018. Photo by Reuters/Kham.

Vietnam has climbed 15 places to become the world’s 90th freest economy in this year’s global ranking but lagged far behind most countries in its neighborhood.

With its overall score increasing by 2.9 points from last year to 61.7, its economy was classed as "moderately free" for the first time in the annual report by the Heritage Foundation, a conservative U.S. think tank.

The ranking is based on 12 factors grouped into four broad categories of rule of law, government size, regulatory efficiency, and open markets.

Vietnam was 17th among 40 economies in the Asia–Pacific region. The country’s upmove came thanks to improvements in fiscal health, government spending, tax burden, trade freedom, and monetary freedom.

Government spending has been 21.6 percent of GDP in the last three years, budget deficits have averaged 2.9 percent of GDP and public debt is equivalent to 42.9 percent of GDP, the think tank said.

But judicial effectiveness, government integrity and property rights got low scores.

"Its ranking could increase further if the government took additional action to liberalize investment rules and the financial sector," the think tank said.

Singapore topped the global list while Malaysia (22nd), Thailand (42nd), Indonesia (56th), and the Philippines (73th) all scored higher than Vietnam.

Singapore was followed in the rankings by New Zealand and Australia.

The world’s biggest economy, the U.S., ranked 20th, down three places from last year, while China fell four places to 107th.