25 September 2025
South Africa ranks 83rd out of 165 countries and territories included in the Economic Freedom of the World: 2025 Annual Report (EFW), released today by the Free Market Foundation (FMF) in conjunction with Canada’s Fraser Institute.
According to the latest data, South Africa was also 83rd last year.
“South Africa’s economic freedom ranking is disappointing, but not surprising,” said David Ansara, CEO of the FMF.
“Only through widespread liberalisation, respect for property rights and limiting the size and scope of government can South Africa escape the malaise it currently finds itself in and climb the rankings in future years,” he said.
“Global economic freedom peaked in 2019 but has declined in each of the four years since then,” said Matthew Mitchell, Senior Fellow at the Fraser Institute and a contributor to the report.
Economic freedom – the degree to which individuals are allowed to make their own decisions about what to buy, how to work, and how to exchange with others – is fundamental to prosperity. Economic freedom is measured by assessing openness to trade, tax and regulatory burdens, government spending, and the soundness of a country’s money.
As part of today’s global launch of the EFW, Ansara spoke with Robert Lawson, Senior Associate at the Fraser Institute, in a video interview about the latest rankings and the current state of freedom in the world. Watch the interview here.
In 2023 (the latest year of available data), Hong Kong was the most economically-free jurisdiction in the world (although its score has declined in recent years), followed by Singapore (2nd), New Zealand (3rd), Switzerland (4th), and the United States (5th).
Crucially, because the data is from 2023, it does not reflect any consequences from the current global trade war (the report does, however, include a chapter previewing some of these effects on US economic freedom).
The rankings of other major countries include the United Kingdom (13th), Germany (15th), Japan (17th), South Korea (38th), France (44th), Italy (46th), Indonesia (65th), Mexico (70th), India (86th), Brazil (87th), China (108th), and Russia (148th).
The 10 lowest-ranked countries were Chad, Libya, Syria, Argentina, Myanmar, Iran, Algeria, Sudan, Zimbabwe, and Venezuela.
People living in countries with high levels of economic freedom enjoy greater prosperity, more political and civil liberties, and longer lives.
For example, per-person GDP in countries in the top 25% of economic freedom was R1.15 million in 2023 compared to only R186,012 for the least economically free quartile of countries.
And poverty rates are lower. In the most economically free quartile, 2 per cent of the population experienced extreme poverty (living on less than R63 per day) compared to 52 per cent in the least-free quartile.
Finally, life expectancy is 79 years in the freest countries compared to 62 years in the least free.
“Where people are free to pursue their own opportunities and make their own economic choices, they lead more prosperous, happier and healthier lives,” Mitchell said.
Here is how South Africa scored in the key components of economic freedom (from 1 to 10 where a higher value indicates a higher level of economic freedom):
- Size of government: 6.06 out of 10, ranking South Africa 117th out of 165 countries in this area.
- Legal system and property rights: 5.88, ranking 54th.
- Access to sound money: 7.68, ranking 87th.
- Freedom to trade internationally: 6.97, ranking 97th.
- Regulation: 6.47, ranking 81st.
“South Africa’s worst ranking has been the size of our government and the amount of economic activity and taxpayer money it sponges up out of the economy,” said Ansara. “We’ve been doing best on legal system and property rights, but that strong ranking is in jeopardy given the existentially threatening policy of expropriation without compensation.”
In a separate interview, Ansara spoke with Neil Emerick, Deputy Chair of the FMF – and long-time collaborator on the EFW project – about South Africa’s ranking:
“[South Africa has] been 83rd in the rankings for a couple of years now… Unfortunately, that means higher levels of unemployment, poverty continuing the way it is, and businesses struggling and not wanting to invest,” Emerick said. “If we don’t do something, then we can expect things to stay the same, which is not good.”
The FMF began its Liberty First initiative in the wake of last year’s general elections and the subsequent formation of the Government of National Unity (GNU). The think tank’s policy agenda is aimed at identifying reforms that would see South Africa climb the economic freedom rankings and bring about freedom and prosperity for all.
“This data is from 2023, meaning it is the last year of reprieve for the GNU before its policies come under scrutiny. From next year, South Africans will be able to answer, ‘Is the GNU working?’” said Ansara.
For more information on the Economic Freedom Network, datasets, and previous Economic Freedom of the World reports, go to www.freetheworld.org.
For more information about Liberty First, visit www.libertyfirst.co.za.
Ends.
