Bangladesh has been ranked 137th among 178 economies in the 2016 Index of Economic Freedom, released by the Heritage Foundation yesterday.
Last year, Bangladesh was ranked 131st, scoring 53.9 points.
The US think tank termed the country’s economic freedom status “mostly unfree,” saying there are concerns over rule of law and open markets in the country.
The country scored 53.3 points, down 0.6 points compared to the last year’s ranking, according to the report jointly prepared by Heritage Foundation and The Wall Street Journal.
“Overall entrepreneurial activity is disadvantaged by an uncertain regulatory environment, poor infrastructure, and the absence of effective long-term institutional support for private-sector development,” read the report.
Bangladesh has shown remarkable macroeconomic resilience, and its economy has grown steadily over the past five years, it said. “Nonetheless, overall entrepreneurial activity is disadvantaged by an uncertain regulatory environment, poor infrastructure, and the absence of effective long-term institutional support for private-sector development.”
Former finance adviser to the caretaker government, AB Mirza Azizul Islam, said the country’s weak trade regime, poor infrastructures and regulatory complexities might affect investments.
According to him, the private sector investment has stuck at around 21% in the past few years.
Bangladesh is ranked 29th in the Asia-Pacific region, while among South Asian countries, Bangladesh has the second lowest place with only Nepal trailing at 151st place. Sri Lanka is ranked 93rd, Bhutan 97th, India 123rd, Pakistan 126th and the Maldives 132nd.
The report said despite a decade of economic and social gains for much of the population, Bangladesh remains one of the world’s poorest nations.
Bangladesh has shown notable success only in management of public finance although “a large bureaucracy hinders government effectiveness”.
“Endemic corruption and criminality, weak rule of law, limited bureaucratic transparency, and political polarisation continue to undermine government accountability,” said the report.
The report also mentioned that obtaining necessary permits for start-ups remains time-consuming. “Contract enforcement and dispute settlement procedures are inefficient, and property laws are antiquated,” it added.
Globally, Hong Kong tops the list followed by Singapore, New Zealand, Switzerland and Australia. The five countries from the bottom are North Korea, Cuba, Venezuela, Zimbabwe and Turkmenistan.
“Economic freedom is a crucial component of liberty. It empowers people to work, produce, consume, own, trade, and invest according to their personal choices,” said the report.
Rule of law, government size, regulatory efficiency and market openness are considered to be four pillars of the economic freedom, the report said.
