Hong Kong and Singapore are the world's most economically free jurisdictions, according to the Economic Freedom of the World: 2000 Report released Jan. 11.

Michael Walker, Executive Director of the Fraser Institute, said that the institute's survey shows economic freedom brings with it endless benefits, from higher cereal yields to increased life expectancy.

The report, published by Canada's Fraser Institute, the Hong Kong Centre for Economic Research, and the U.S.-based Cato Institute, in conjunction with independent institutes from 52 other countries, ranks 123 countries on their level of economic freedom.

Hong Kong has taken top slot since 1970, except for a dip to second place in 1985. The SAR was pegged level with Singapore because of uncertainties surrounding the 1997 handover, said Michael Walker, Executive Director of the Fraser Institute, who presented a snapshot of the survey's findings at a luncheon organized by the Chamber and the Hong Kong Centre for Economic Research.

"In 1997 there was a great concern on the part of international investors that some of the contracts which had been entered into by the Hong Kong Government would not be respected by the new government," he said.

That has not happened, of course, but due to the lagged effect of the data, that uncertainty is represented in the findings.

He expects Hong Kong will recapture top slot as the world's least restricted economy in the 1999 report.

The report ranks Hong Kong and Singapore the most economically free places on earth with a score of 9.4 out of 10 in 1997. In the last report in 1995, Hong Kong scored 9.8. Due to the two-year lag, the Government's intervention in the stock and futures markets in 1998 has not been calculated.

One of the most compelling results of the study is the relationship between economic freedom and prosperity, Dr Walker said. Countries that score in the top quintile of the most economically free had an average per capita GDP of US$18,108, and an average growth rate of 1.6 per cent, he said.

By contrast, the bottom 20 per cent of economically free countries had an average per capita GDP of US$1,669, and an average growth rate of -1.32 per cent. Also, life expectancy in the top quintile is 20 years longer than that of the bottom quintile.

Following Hong Kong and Singapore, the next freest economies are New Zealand (3rd), the United States (4th), the United Kingdom (5th), Ireland (6th), Canada (7th), Australia (7th), The Netherlands, Luxembourg and Switzerland tying 9th place.

Out of 23 variables used to gather information for the report, the seven major categories of variables included in the index are: 1) size of government, 2) the structure of the economy and the use of markets, 3) monetary policy and price stability, 4) freedom to use alternative currencies, 5) legal structure and security of private ownership, 6) freedom of trade with foreigners, and 7) freedom of exchange in capital and financial markets.

The full report can be downloaded at http://www.freetheworld.com/release.html