Economic freedom in Spain is in decline. The country has achieved a score of 65 points in the analysis carried out by the Institute of Economic Studies (IEE), the thing thank of the CEOE with data from the Heritage Foundation.
This places the country in the position of the 38 comparable of the OECD and reflects a drop of more than 3 points with respect to the 68.2 points with which it was rated last year.
The data from this edition place Spain as the fifth country that has seen its degree of economic freedom deteriorate the most between 2022 and 2023, with a decrease of 3.2 points that practically doubles the average drop observed in the OECD. Only Chile, Lithuania, Greece and Iceland experience a more intense setback, although three of these four countries have a higher general score than Spain, so that only the Hellenic economy presents a more unfavorable situation, to the extent that its score general is worse and its tendency worsens more rapidly.
The president of IEE, Iñigo Fernández de Mesa, explained this Monday during the presentation of the study that the high public deficit and the great long-term indebtedness of the State are the reasons that weigh the most in the deterioration of economic freedom in Spain since This high weight of the State has a direct impact on the margin for doing business that companies have.
Spain moves away from Switzerland, which with 83.3 points out of 100 is the country with the most liberalized economy in the OECD, followed by Ireland with 82 points and New Zealand with 78.9.
The average result for the OECD member countries as a whole reaches, in 2023, 71 points, below the 72.7 points reached in the evaluation of last year 2022. Australia exceeds the average score (74.8 points) , Canada (73.7 points), Germany (73.7 points), South Korea (73.7 points), Latvia (72.8 points), Iceland (72.2 points), Lithuania (72.2 points) , Czech Republic (71.9 points), Austria (71.1 points) and Chile (71.1 points).
Below the OECD average are countries as prominent as the United States (70.6 points), the United Kingdom (69.9 points), Portugal (69.5 points), and Japan (69.3 points).
Only the economies of Hungary (64.1 points), France (63.6 points), Mexico (63.2 points), Colombia (63.1 points), Italy (62.3 points) obtain a result lower than that of Spain. , Greece (56.9 points) and Turkey (56.9 points).
The study analyzes twelve categories to prepare the index, Spain is below the OECD average in judicial effectiveness, good governance, tax burden, public spending, fiscal health, business freedom, labor flexibility, investment facility and financial solvency. Only in three is it higher than the OECD average: property rights, monetary stability and trade openness.
According to the report , it is especially worrying that Spain has experienced such a marked decline in these variables, since this circumstance places us in a position of increasing financial vulnerability. If we look at the mix referring to the size of the State, we find that our score is only 31.9 points, a marked decrease compared to the 42.6 points reached in the 2022 evaluation.
“Economic freedom is important because it is directly related to the standard of living of citizens. There is a close correlation between the commitment to laissez faire and the rise in GDP per capita. Promoting public policies aimed at propping up capitalism leads to significant improvements in people's incomes”, points out Fernández de Mesa.
Among the examples cited by Fernández de Mesa as the reason for this deterioration is that of the Financial Client Defense Authority which, although it has not entered into force due to the call for early elections, "the analysis carried out indicates that given its degree of interventionism it could even be considered anti-Constitutional", pointed out the president of the IEE.
