Puerto Rico ranks 69th in global Economic Freedom Index
Puerto Rico’s standing in the 2020 edition of the Economic Freedom Index did not reflect drastic changes, increasing just oane point to 64.4 in 2020 vs. 64.4 in 2019.
This ranks the island in 69th place among 181 countries worldwide, and in 13th place among 33 countries in the Americas. The US mainland ranks 17 worldwide.
Of the eight categories that were measured in Puerto Rico — and that are directly related to governance — four changed compared to 2019. The only one that dropped when compared to 2019) was the Government Integrity subindex, which measures the public’s perception of the degree of transparency in government and corruption on the island.
The island’s 2020 scores were: 64.6 in property rights (up from the 64.1 in 2019); 34 in government integrity (down from 48.5 in 2019); judicial effectiveness (flat at 64.3 year-over-year); tax burden (up 62.5 from the 61.1 in 2019); government spending (49.3, up from 24.5 in 2019); fiscal health (73.9, up from the 65.2 in 2019); business freedom (flat at 51.2 Y-O-Y); labor freedom (flat at 65 Y-O-Y); monetary freedom (down to 75.5 from the 76.6 in 2019); trade freedom (79.8, down from 86.6 in 2019); investment freedom (flat at 85 Y-O-Y); and financial freedom (flat at 80 Y-O-Y).
The Center for Economic Renewal, Growth and Excellence (CRECE, in Spanish) unveiled the results of the Economic Freedom Index, which measures the degree of economic freedom and sustainable growth in 181 countries, using the methodology of the Heritage Foundation.
This is the EFI’s fourth consecutive edition, which it commissioned to local firm Inteligencia Económica.
The study to determine the EFI focuses on four components of the business climate in which the government creates public policy: rule of law; government size; regulatory efficiency; and open markets.
This edition of Puerto Rico’s EFI gives special attention to the applicable tax structure in Puerto Rico, using the methodology of the Tax Foundation to measure the State Tax Climate Index.
The results of the analysis provide precise information about the competitive disadvantages and structural differences between Puerto Rico and the 50 states of the U.S.
This information should serve as the foundation to develop public policy aimed at increasing the island’s competitive edge and capacity to retain human capital, the nonprofit stated.