2015 Index of Economic Freedom

Burma

overall score46.9
world rank161
Rule of Law

Property Rights10.0

Freedom From Corruption21.0

Limited Government

Government Spending77.9

Fiscal Freedom86.9

Regulatory Efficiency

Business Freedom28.7

Labor Freedom79.3

Monetary Freedom66.1

Open Markets

Trade Freedom74.2

Investment Freedom15.0

Financial Freedom10.0

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Quick Facts
  • Population:
    • 64.9 million
  • GDP (PPP):
    • $113.0 billion
    • 7.5% growth
    • 6.2% 5-year compound annual growth
    • $1,740 per capita
  • Unemployment:
    • 3.5%
  • Inflation (CPI):
    • 5.8%
  • FDI Inflow:
    • $2.6 billion
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Burma’s economic freedom score is 46.9, making its economy the 161st freest in the 2015 Index. Its score is 0.4 point better than last year due to improvements in five of the 10 economic freedoms, including freedom from corruption, labor freedom, and monetary freedom, that outweigh a substantial decline in the control of government spending. Burma is ranked 38th out of 42 countries in the Asia–Pacific region, and its overall score is much lower than the regional average.

Over the past five years, economic freedom in Burma has advanced by about 9.0 points, the second-best improvement among graded countries. From a low base, Burma has made considerable strides in liberalizing its economy and opening itself to the outside world. Gains in eight of the 10 economic freedoms include greater price stability and double-digit improvements in labor freedom and investment freedom.

Nevertheless, Burma remains a “repressed” economy due to years of state intervention, poor institutional structures, and autarkic investment and financial regimes. To solidify and build on the past half-decade’s gains, the government must continue its reform agenda with particular emphasis on stamping out corruption, enforcing property rights, creating an independent judiciary, and further opening up the economy to the international marketplace.

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Background

Burma has been a military dictatorship since 1962 but since 2010 has pursued limited political and economic reform, including releases of political prisoners, relaxation of media censorship, and exchange rate reform. Sectarian violence and continued persecution of Muslim and Christian minorities remain problems. National League for Democracy leader and Nobel laureate Aung San Suu Kyi was released from jail in November 2010 and won a seat in parliament in 2012. The United States and the European Union eased some sanctions in response to Burma’s limited changes, but state-sponsored repression has led many to urge caution before lifting all sanctions. Heavy government intervention in the economy has made Burma one of the world’s poorest countries.

Rule of LawView Methodology

Property Rights 10.0 Create a Graph using this measurement

Freedom From Corruption 21.0 Create a Graph using this measurement

Burma’s emerging but deeply flawed democratic reform process will likely lose momentum in the run-up to the 2015 elections. Corruption is endemic. Due to a complex and capricious regulatory/legal environment and extremely low government salaries, rent-seeking is ubiquitous. Rule of law and protection of property rights are weak. Judicial decisions are often influenced by government interference, personal relationships, or bribes.

Limited GovernmentView Methodology

Burma’s top individual income tax rate is 20 percent, and its top corporate tax rate is 30 percent. Commercial and capital gains taxes add to government revenue, but the overall tax burden remains less than 5 percent of gross domestic product. Public expenditures amount to 27.2 percent of the domestic economy, and public debt is equal to around 43 percent of total domestic output.

Regulatory EfficiencyView Methodology

Significant bureaucratic impediments to entrepreneurial activity and economic development persist. The labor market remains underdeveloped, and enforcement of the labor codes is ineffective. The informal sector continues to be an important source of employment. Inflation is expected to remain elevated, led by higher prices for rice and other staple foods and electricity.

Open MarketsView Methodology

Burma’s average tariff rate is 3.2 percent, and some imports face additional restrictions. The government reviews new foreign investment, and state-owned enterprises dominate some sectors of the economy. The financial system remains underdeveloped, and the banking sector is dominated by state-owned banks. Most loans are directed to government-led projects, and access to credit remains very poor.

Country's Score Over Time

Bar Graph of Burma Economic Freedom Scores Over a Time Period

Country Comparisons

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Regional Ranking

rank country overall change
1Hong Kong89.6-0.5
2Singapore89.40.0
3New Zealand82.10.9
4Australia81.4-0.6
5Taiwan75.11.2
6Japan73.30.9
7South Korea71.50.3
8Malaysia 70.81.2
9Macau70.3-1.0
10Brunei Darussalam68.9-0.1
11Kazakhstan63.3-0.4
12Thailand 62.4-0.9
13Philippines62.22.1
14Samoa61.90.8
15Kyrgyz Republic 61.30.2
16Vanuatu61.11.6
17Azerbaijan61-0.3
18Tonga59.31.1
19Mongolia59.20.3
20Fiji590.3
21Sri Lanka58.6-1.4
22Indonesia58.1-0.4
23Cambodia57.50.1
24Bhutan57.40.7
25Pakistan 55.60.4
26India54.6-1.1
27Bangladesh 53.9-0.2
28Maldives53.42.4
29Papua New Guinea53.1-0.8
30China52.70.2
31Tajikistan52.70.7
32Vietnam51.70.9
33Laos51.40.2
34Nepal51.31.2
35Micronesia49.6-0.2
36Solomon Islands470.8
37Uzbekistan470.5
38Burma46.90.4
39Kiribati46.40.1
40Timor-Leste45.52.3
41Turkmenistan41.4-0.8
42North Korea1.30.3
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