2016 Index of Economic Freedom


overall score41.9
world rank174
Rule of Law

Property Rights5.0

Freedom From Corruption17.0

Limited Government

Government Spending92.2

Fiscal Freedom95.3

Regulatory Efficiency

Business Freedom30.0

Labor Freedom20.0

Monetary Freedom69.4

Open Markets

Trade Freedom80.0

Investment Freedom0.0

Financial Freedom10.0

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Quick Facts
  • Population:
    • 5.8 million
  • GDP (PPP):
    • $82.1 billion
    • 10.3% growth
    • 11.1% 5-year compound annual growth
    • $14,165 per capita
  • Unemployment:
    • 10.5%
  • Inflation (CPI):
    • 6.0%
  • FDI Inflow:
    • $3.2 billion
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Economic freedom remains severely repressed in Turkmenistan. The country’s rankings in the categories that measure respect for the rule of law are among the worst in the world. Corruption is pervasive, and property rights are ignored.

Economic Freedom Snapshot

  • 2016 Economic Freedom Score: 41.9 (up 0.5 point)
  • Economic Freedom Status: Repressed
  • Global Ranking: 174th
  • Regional Ranking: 41st in the Asia–Pacific Region
  • Notable Successes: Open Markets and Fiscal Freedom
  • Concerns: Investment Freedom and Financial Freedom
  • Overall Score Change Since 2012: –1.9

Freedom is nearly nonexistent in the investment sector, as the six state-owned banks hold over two-thirds of all assets and control the allocation of credit. The public sector dominates labor markets, and the non-transparent and erratically enforced regulatory system virtually precludes private-sector entrepreneurial activity, except activity that is small in scale and conducted informally.



In 2012, President Gurbanguly Berdymukhammedov was reelected to a second five-year term with 97 percent of the vote in elections that international observers regarded as flawed. The presidency tightly controls the judiciary, the legislature, the economy, social services, and the mass media. Berdymukhammedov’s policies are somewhat more open to the world than those of his predecessor, President-for-Life Saparmurad Niyazov, but the government still tends toward isolationism. Turkmenistan has intensive agriculture in irrigated oases, sizable oil resources, and the world’s sixth-largest natural gas reserves. Berdymukhammedov has encouraged some foreign investment in the energy sector, especially from Russia, China, and Iran. Like those of other Central Asian republics, Turkmenistan’s economy has been negatively affected by the economic slowdown in Russia.

Rule of LawView Methodology

Property Rights 5.0 Create a Graph using this measurement

Freedom From Corruption 17.0 Create a Graph using this measurement

Corruption is widespread, with public officials reportedly forced to bribe their way into their positions. The judicial system is subservient to the president, who appoints and removes judges without legislative review. The legal system does not enforce contracts and property rights effectively. Judges are poorly trained and open to bribery. All land is owned by the government, and other ownership rights are limited.

Limited GovernmentView Methodology

The personal income tax rate is a flat 10 percent, and the corporate tax rate is 8 percent. Other taxes include a value-added tax and a property tax. The tax burden equals 17.4 percent of total domestic income. Government spending equals 18.1 percent of total domestic output. Budget surpluses have been recorded, and public debt remains below 20 percent of GDP. Revenue from gas exports to China has sustained government spending.

Regulatory EfficiencyView Methodology

The regulatory system is highly arbitrary, and enforcement is inconsistent. The public sector provides most jobs, and the informal sector remains an important source of employment. Turkmenistan was the only country in the world to provide its citizens with gas, electricity, and water free of charge, but high budget deficits and lower global oil and gas prices forced the government to cut those subsidies substantially in 2014.

Open MarketsView Methodology

Turkmenistan’s average tariff rate is technically 0 percent, but non-tariff barriers restrict imports. It is illegal to import cars that are more than five years old. Bureaucratic barriers interfere with foreign trade and investment. Foreign exchange accounts require government approval, as do all payments and transfers. The underdeveloped financial system remains heavily state-controlled, with 90 percent of all loans directed to state-owned enterprises.

Country's Score Over Time

Bar Graph of Turkmenistan Economic Freedom Scores Over a Time Period

Country Comparisons

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Regional Ranking

rank country overall change
1Hong Kong88.6-1.0
3New Zealand81.6-0.5
7South Korea71.70.2
8Malaysia 71.50.7
10Brunei Darussalam67.3-1.6
11Thailand 63.91.5
17Sri Lanka59.91.3
19Kyrgyz Republic 59.6-1.7
26Pakistan 55.90.3
29Bangladesh 53.3-0.6
30Papua New Guinea53.20.1
37Solomon Islands470.0
42North Korea2.31.0
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