US think-tank hails Hong Kong as 'world's most free economy'

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Hong Kong has the most free economy in the world, thanks to a combination of light regulation and the embracing of laissez-faire economic policy, according to the Heritage Foundation, a right-wing, US-based think tank.

The former British territory scored 89.9 out of 100 on the foundation's index, which looks at countries under four categories – rule of law, how efficient its regulations are, the size of government, and the openness of the markets.

The think tank celebrated a recent Hong Kong government plan to give a rebate on excess revenue to citizens, but it said plans to implement a minimum wage, had "moved Hong Kong modestly in the direction of a more bureaucratic and politicised economy".

The index does not take into account Hong Kong has only a limited democracy, and some complain Beijing, which has run Hong Kong since it was handed back to China in 1997, has been exercising undue influence despite a 50-year promise not to change the Basic Law, Hong Kong's mini-constitution. By comparison, China was 138 in the index, down from 135 in 2011.

There have also been complaints about the widening wealth gap in Hong Kong and how the environmental situation is worsening.

Hong Kong's regional rival for investment, Singapore, was second in the index, followed by Australia, New Zealand and Switzerland. The least free country was North Korea, in 179th place.