2021 Index of Economic Freedom

Burundi

OVERALL SCORE49.9
WORLD RANK161
Rule of Law

Property Rights28.0

Judicial Effectiveness32.1

Government Integrity27.0

Government Size

Tax Burden77.1

Government Spending79.3

Fiscal Health32.2

Regulatory Efficiency

Business Freedom51.8

Labor Freedom67.3

Monetary Freedom74.7

Open Markets

Trade Freedom49.8

Investment Freedom50.0

Financial Freedom30.0

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Quick Facts
  • Population:
    • 11.5 million
  • GDP (PPP):
    • $8.7 billion
    • 1.8% growth
    • -0.1% 5-year compound annual growth
    • $783 per capita
  • Unemployment:
    • 1.4%
  • Inflation (CPI):
    • -0.7%
  • FDI Inflow:
    • $1.0 million

Burundi’s economic freedom score is 49.9, making its economy the 161st freest in the 2021 Index. Its overall score has increased by 0.9 point, primarily because of an improvement in fiscal health. Burundi is ranked 40th among 47 countries in the Sub-Saharan Africa region, and its overall score is below the regional and world averages.

Although economic freedom in Burundi increased slightly in 2021, the economy remains in the repressed category. For Burundi’s economy to climb out of the ranks of the repressed, the government will have to implement deep, broad, and well-institutionalized reforms that dramatically improve its scores for property rights, judicial effectiveness, and government integrity. Fiscal reforms to lower debt and improvements in the business climate are also needed.

IMPACT OF COVID-19: As of December 1, 2020, one death had been attributed to the pandemic in Burundi, and the economy was forecast to contract by 3.2 percent for the year.

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Background

Burundi has had a turbulent history since gaining independence from Belgium in 1962: Its first democratically elected president, for example, was assassinated in 1993 after only 100 days in office. Sidestepping the two-term constitutional limit, President Pierre Nkurunziza was elected to a third term in 2015, and hundreds of Burundians were killed in the resulting unrest. The government used violence and intimidation to ensure passage of a 2018 referendum that further centralized presidential power. Nkurunziza’s hand-picked successor, Evariste Ndayishimiye, won the presidency in May 2020 elections that the opposition denounced as fraudulent. He took office after Nkurunziza died of COVID-19 in June. Subsistence agriculture dominates the economy, and well over half of the population lives below the poverty line.

Rule of LawView Methodology

Property Rights 28.0 Create a Graph using this measurement

Judicial Effectiveness 32.1 Create a Graph using this measurement

Government Integrity 27.0 Create a Graph using this measurement

Historically, land titling in Burundi involves a lengthy, opaque, and centralized process. Private property is vulnerable to government expropriation and armed banditry, and property registration is difficult. The judiciary is nominally independent but lacks capacity. Judges are subject to political pressure. Burundi remains one of sub-Saharan Africa’s most corrupt countries. Corruption has been reported in the award of licenses and concessions and among customs officials.

Government SizeView Methodology

The top individual income tax rate is 35 percent, and the top corporate tax rate is 30 percent. The overall tax burden equals 12.9 percent of total domestic income. Government spending has amounted to 26.3 percent of total output (GDP) over the past three years, and budget deficits have averaged 6.1 percent of GDP. Public debt is equivalent to 60.7 percent of GDP.

Regulatory EfficiencyView Methodology

Burundi has lost ground in business freedom. The costs of starting a business, dealing with permits, and obtaining electricity have risen. In general, little recovery is possible in insolvency cases. Skilled labor is scarce, and only a minority of workers enjoy formal employment. Labor statistics are not tracked well. Subsidies and rationing of fuel and electricity persist, and state-owned enterprises and agriculture-support programs influence other prices.

Open MarketsView Methodology

Burundi has two preferential trade agreements in force. The trade-weighted average tariff rate is 15.1 percent, and three nontariff measures are in effect. Bureaucratic barriers, exacerbated by the opaque investment framework, limit foreign and domestic investment. The financial system remains underdeveloped. Banks continue to increase their domestic assets, and there are microfinance institutions, but overall access to credit remains limited.

Country's Score Over Time

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Regional Ranking

RANK COUNTRY OVERALL CHANGE
1Mauritius772.1
2Rwanda68.3-2.6
3Botswana67.6-2.0
4Seychelles66.32.0
5Cabo Verde63.80.2
6Namibia62.61.7
7Côte d'Ivoire61.72.0
8Tanzania61.3-0.4
9South Africa59.70.9
10Benin59.64.4
11Ghana59.2-0.2
12The Gambia58.82.5
13Nigeria58.71.5
14Uganda58.6-0.9
15Gabon58.11.4
16Senegal580.0
17Madagascar57.7-2.8
18Togo57.53.4
19Niger57.32.6
20Guinea56.50.0
21Burkina Faso56.5-0.2
22Djibouti56.23.3
23Mauritania56.10.8
24São Tomé and Príncipe55.9-0.3
25Comoros55.72.0
26Mali55.6-0.3
27Eswatini55.1-0.2
28Kenya54.9-0.4
29Guinea-Bissau54.91.6
30Angola54.22.0
31Lesotho53.5-1.0
32Cameroon53.4-0.2
33Malawi530.2
34Sierra Leone51.73.7
35Ethiopia51.7-1.9
36Mozambique51.61.1
37Republic of Congo50.78.9
38Chad50.40.2
39Zambia50.4-3.1
40Burundi49.90.9
41Equatorial Guinea49.20.9
42Liberia49.20.2
43Democratic Republic of Congo49-0.5
44Central African Republic48.8-1.9
45Eritrea42.33.8
46Zimbabwe39.5-3.6
47Sudan39.1-5.9
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