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Global index rates Kenya's economy 'unfree' in its latest ranking

BUSINESS
By Moses Omusolo | Dec 28th 2021 | 2 min read
By Moses Omusolo | December 28th 2021
BUSINESS

A hawker displays his products on a wheelbarrow. [Benjamin Sakwa, Standard]

Kenya has been rated lowly in a global index of economic freedom.

In the 2021 ranking by the American think tank, The Heritage Foundation, Kenya and many of its African peers were declared “mostly unfree” economies with scores below 60 out of 100.

A country has to score between 70-79 points in the index to be considered “mostly free” or between 80-100 to join the few “free” nations economically.

States that score 60-69 points are considered “moderately free”.

Kenya scored 54.9 points. “Of the 178 economies ranked in the index, five are considered free, and an additional 92 are at least ‘moderately free’.

Over 81 economies received scores below 60 and are rated ‘mostly unfree’ or ‘repressed,’” said the foundation.

The parameters of the index included property rights, judicial effectiveness, government integrity, tax burden, government spending and business freedom. Others were freedom of labour, trade, finance and investment.

Moderately free

Kenya was ranked at position 138 globally, significantly outranked by Eastern Africa peers - Rwanda at position 17 and Tanzania at position 93.

The two were rated “moderately free” economies after scoring 68.3 and 61.3 points respectively.

Uganda was at position 106 on 58.6 points, while Djibouti had 56.2 points and Ethiopia 51.7 points, all considered “mostly unfree” in the report.

“The data reported in the 2021 Index of Economic Freedom confirms the importance of economic freedom in promoting rapid growth and sustainable social progress,” said The Heritage Foundation.

The study found citizens of “free” or “mostly free” countries enjoy incomes that are more than double the global average and more than six times higher than in “repressed” economies.

This, according to the research, positions people in such societies to live longer and enjoy healthier lives.

“They have access to higher quality ‘social goods’ such as education, health care, and a cleaner environment.” 

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