Topic 4 International Trade Relations
Content
4. INTERNATIONAL TRADE RELATIONS: The most important part of the international/world economic flow (circuit ) International trade – trade among countries, comprising inflows (import) and outflows (export) of goods and services. World trade – implication of all countries of the world (world market since XIX century) Foreign trade – one country perspective comprises all trade relations of one economy with the rest of the world. World price formation: • Supply and demand; • TNC – main producers and exporters; • Auctions; • Tenders; • Commodity exchange market. Factors that have stimulated the dynamic growth of international trade: Development and deepening of international labor division and production internationalization - Widespread process of economic integration - Liberalization of international trade - Scientific and technological revolution - Diversification of services - Development of TNCs International trade can be described by analyzing: 1. Volume 2. Product structure 3. Geographical distribution Periodical trade collapse World trade volumes fell on three other occasions since 1965 • • • -0.2 per cent in 2001, -2.0 per cent in 1982, -7.0 per cent in 1975,
Product structure: I. MERCHANDISE A. Primary Products a. Agricultural products 1) Food 2) Raw materials b. Fuels and mining products B. Manufactured Products a. Iron and steel b. Chemicals c. Machinery and transport equipment 1) Office and telecom equipment 2) Transport equipment - Automotive products II. COMMERCIAL SERVICES A. Transportation B. Travel C. Other Commercial Services a. Communications services b. Construction c. Insurance d. Financial services e. Computer services and information
f. royalties and license fees g. other business services The top 3 traders-US, Germany and China, represent 28% of the world’s merchandise trade. Asia accounts for almost 30% of the world merchandise trade.
but none of these episodes approached the magnitude of the 2009 year plunge – (-12 per cent).
1
Asia makes strong merchandise exports: •
recovery
in
•
Europe’s exports of manufactured products grew by 11 per cent in 2010 but this rise was not strong enough to regain the precrisis level. Asian exports of manufactured products grew by 30 per cent in 2010, making up for the loss incurred during the financial crisis. For the Middle East, Africa and the CIS regions, fuels and mining products constitute the main exports, accounting for 68 per cent, 66 per cent and 64 per cent respectively of their total merchandise exports in 2010. •
Within manufactured goods, iron and steel and integrated circuits registered the strongest growth (29.4 per cent and 35.3 per cent respectively). As of 2009, exports of food overtook exports of automotive products. The share of primary products in world trade increased from 22 per cent in 2000 to 30 per cent in 2010.
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Value of food exports returns to pre-crisis level: • World food exports expanded by 12 per cent in 2010, recovering to the pre-crisis level of US$ 1,118 billion. The European Union, by far the major exporter of food products, increased its exports by only 5 per cent. A 15.4 per cent increase in its exports outside the EU was offset by a modest 2 per cent increase in trade within the EU, which represents the vast majority of its total trade in food. Brazil, the third largest exporter of food, recorded a 17 per cent rise in its exports. Its major export destination was once again Asia.
•
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Manufactured goods record strongest growth in a decade: • From 2000 to 2010, trade in manufactured goods grew in volume terms by an annual average of 4.8 per cent; increasing by twice as much as fuels and mining products. Trade in agricultural products grew by 3.7 per cent. The average annual growth in trade in manufactured goods, fuels and mining products and agricultural products was higher, however, from 1990 to 2000 (7.2 per cent, 3.7 per cent and 4 per cent respectively). During the past decade, prices of fuels and mining products recorded the highest annual average growth (10.7 per cent), followed by agricultural products (5.6 per cent) and manufactured goods (2.9 per cent).
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EU is the largest importer of fuels and mining products: • China is the second-largest importer of non-fuel minerals, such as iron ores and copper ores, after the European Union. In 2010, non-fuel minerals accounted for almost half of China’s total import bill on fuels and mining products, increasing its share by 10 percentage points since 2000. EU exports of chemicals to countries within the European Union grew by 9 per cent in 2010, while exports to non-EU countries increased by 14 per cent. With exports of US$ 87.6 billion, China overtook Switzerland as the third-largest exporter of chemical products after the European Union and the United States.
•
•
Ores and other minerals show strongest recovery: • The strongest recovery in merchandise trade was for ores and other minerals, which grew by 54.1 per cent in 2010, followed by non-ferrous metals (42.7 per cent).
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Car sector rebounds strongly with 29% growth: • The automotive sector, which saw a 31.5 per cent drop in sales following the financial crisis, rebounded strongly with 29.1 per cent growth in 2010. Mexico became the fourth-largest exporter of automotive products in 2010, increasing its shipments by 54 per cent. Japanese shipments of automotive products to the United States expanded by 36 per cent in 2010 and to China by 51 per cent.
•
Among the major exporters of clothing, India registered a decline of 3.1 per cent.
Europe and Asia are the main providers of commercial services: • World travel receipts totalled US$ 940 billion in 2010, accounting for a quarter of world exports of commercial services. With US$ 385 billion, Europe accounted for 41.1 per cent of total exports (a decline of almost 8 percentage points compared with 2005). Exports of transportation services accounted for 21.3 per cent of global exports of commercial services in 2010, compared with an average share of 22-23 per cent in the last decade. Most exports came from European countries (US$ 374 billion), Asia (US$ 226 billion) and North America (US$ 84 billion). World exports of “other commercial services” totalled US$ 1,970 billion in 2010, accounting for 53.3 per cent of global exports of commercial services. Half of these exports originated from Europe, largely from the European Union. Asia’s share of other commercial services exports increased to 25.4 per cent. North America’s share was 18.2 per cent.
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China overtakes EU as major exporter of telecom equipment: • Asia accounted for 63 per cent of world exports of office and telecom equipment in 2010. Based on gross sales of US$ 180 billion, China overtook the European Union as the major exporter of telecom equipment in 2010. The European Union boosted its exports of integrated circuits by 30 per cent, making it the largest exporter if the re-export trade of Hong Kong, China and Singapore are disregarded. •
•
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China becomes the world’s largest exporter of textiles: • China became the major exporter of textiles in 2010, pushing the European Union into second place. India recorded a 40 per cent increase in its exports of textiles in 2010 to become the third-largest exporting nation, just ahead of the United States. China’s share in world exports of clothing increased to 37 per cent in 2010, rising from 18.3 per cent in 2000, while its share in the country’s total exports declined to 8.2 per cent, from 14.5 per cent in 2000.
3
Trade in services is bouncing back: • World exports of transportation services rose by 15 per cent in 2010, after dropping by 23 per cent during the economic crisis. The recovery was mainly driven by Asia’s exports. World travel receipts grew by 8 per cent in 2010. According to the United Nations World Tourism Organization, the 6.6 per cent surge in global international tourist arrivals in 2010 more than offset the decline triggered by the recession. World exports of financial services increased by 7 per cent in 2010 following a sharp fall during the economic crisis.
•
•
•
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Insurance services exports stagnated whileexports of computer and information services, and royalties and licence fees increased by 13 and 11 per cent. • Construction exports declined in nearly in all regions in 2010 in the aftermath of the economic crisis. Exports of communications services dropped by 8 per centin value, reflecting a significant drop in prices.
Financial services struggle to recover: • Europe’s financial services sector, the hardest hit by the global crisis, struggled to recover in 2010. Extra-EU exports rose marginally (by 3 per cent), while in Switzerland they declined by 2 per cent. Europe accounted for 49 per cent of global exports of financial services in 2010. US exports of financial services exports expanded by 5 per cent in 2010. Asia experienced a strong recovery in financial services, with Singapore’s exports up by 31 per cent, and Hong Kong’s by 12 per cent. India’s exports grew by 64 per cent but Japan’s fell by 25 per cent.
• •
Most services sectors remain below pre-crisis levels: • Export values of services sectors such as transport and finance remain below precrisis levels despite a rapid recovery in 2010. Exports of transport services totalled US$ 785 billion in 2010, US$ 105 billion less than in 2008. Exports of financial services totalled US$ 265 billion in 2010, down by 10 per cent compared with 2008. Exports of computer and information services rose to US$ 215 billion in 2010, US$ 15 billion higher than in 2008. Global receipts of royalties and licence fees reached US$ 245 billion in 2010, US$ 20 billion higher than in 2008.
•
Travel exports rise rapidly in Asian economies: • Macao became the world’s fifth-largest exporter of travel in 2010, recording a 53 per cent increase in its travel receipts. Thanks to its thriving gaming sector, Macao share in world travel exports has more than doubled in five years, reaching 2.9 per cent in 2010. Exports of travel expanded rapidly in other Asian countries, where the tourism sector experienced very strong growth. China’s travel receipts grew by 15 per cent in 2010, while in Hong Kong the increase was by 35 per cent. Thailand’s travel exports were up by 26 per cent, and in Malaysia they rose by 16 per cent. In the United States, travel receipts grew by 9 per cent, reflecting higher inflows of foreign tourists. In the European Union, travel exports fell by 2 per cent, while in Turkey they stagnated.
•
•
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Asia’s transportation services achieve strong growth: • Asia’s transport sector rebounded strongly in 2010, with major exporting countries achieving double-digit growth rates. In China, exports rose by 45 per cent, and in the Republic of Korea by 33 per cent. Exports from Hong Kong and Japan expanded by 28 per cent and 23 per cent respectively. Europe recovered at a much slower pace. In 2010, EU exports of transport services rose by 8 per cent, while in Norway, growth was only 2 per cent.
4
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The crisis in construction is not over yet: • Global exports of construction contracted by 1 per cent in 2010, indicating that the effects of the global recession persist.
•
All leading exporters, with the exception of China, recorded negative growth. In the European Union, the world’s leading constructor, exports declined by 7 per cent, and in Japan by 10 per cent. In the Republic of Korea and Russia, the decline was around 20 per cent. China was the only top exporter with strong growth. In 2010, China’s exports of construction expanded by 53 per cent, fuelled by several infrastructure projects especially in Africa.
- Economizing and maintaining stocks (energy). Trade policy: A component part of the broader economic policy of a country which deals with the sphere of foreign economic relations
- Comprises all the regulations adopted by the government with the view to promote or restrict foreign trade and to protect the national economy from foreign competition. Broad goals of the trade policy: To promote foreign economic relations by increasing exports; To protect the national economy from foreign competition by controlling and limiting imports; To equilibrate the trade balance (difference between the value of exports and that of imports).
Openness degree of a national economy: According to the level of involvement in international labor division national economies can be classified as: - Closed economies/autarchies – development is determined exclusively by inward tendencies, minimal foreign economic relations Open economies Indexes measuring openness degree: - Import quota = Import / GDP * 100% - Export quota = Export / GDP * 100% Level of openness depends on:
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-
Short and medium term objectives: To improve foreign trade structure; To stimulate or restrict trade in certain product groups; To modify the geographical orientation of foreign trade; To increase the purchasing power of exports etc.
Size of the economy Natural resources endowment Structure of national economy (branches) -
Economic security: Optimal level of interaction with the world economy Interdependency can lead to dependency
Trade policy: 1. Tariff instruments (Customs policy) 2. Non-tariff instruments 3. Promotion and stimulation instruments Tariff barriers to trade: Customs duties – main tools
-
Measures taken by government to limit or avoid negative influence of external factors: - Diversification of trade relations (Moldova, China) - Intensification of multilateral cooperation
5
- Revenue and protective customs duties; - Import, export and transit customs duties;
- Ad-valorem, customs duties;
specific,
compound
(mixed)
- Ordinary, conventional, preferential, differential (anti-dumping, anti-subsidy) Non-tariff barriers to trade: - Quantitative restrictions (embargoes, import quotas, licensing, voluntary export restraints) - Restrictions affecting import price (minimum and maximum import price, VAT, import deposit) - Government participation in trade and restrictive practices (government procurement, state trade) - Customs practices; procedures and administrative
by creating 10 benchmarks that gauge the economic success of 183 countries around the world. Trade freedom: Trade freedom is a composite measure of the absence of tariff and non-tariff barriers that affect imports and exports of goods and services Moldova – 80,2 (2011) 79,0 (2012) General characteristics international trade: and trends in
1. International trade is a dynamic flow 2. Developed countries continue to dominate in the international trade relations 3. International trade is regionalized (based on increased institutionalization) 4. Simultaneous decrease of tariffary and rise of non-tariffary protectionism. 5. Internalization of international trade 6. Tripolization of international trade 7. Continuous diversification of international trade flows.
- Technical barriers to trade (sanitary and phytosanitary regulations, security norms, packaging and labeling norms – international standards). Promotion and stimulation measures: 1. Export promotion (international negotiations and cooperation agreements, participating and organizing international exhibitions, establishing agencies and offices abroad etc. ) 2. Export stimulation Budgetary measures (direct and indirect subsidies, export bonus) Fiscal measures (tax exemptions on exported goods, tax exemptions for exporters) Financial measures (export credits) Currency measures (currency national currency depreciation) bonus,
-
-
Index of Economic Freedom: For over a decade, The Wall Street Journal and The Heritage Foundation, have tracked the march of economic freedom around the world with the influential Index of Economic Freedom. Since 1995, the Index has brought Smith's theories about liberty, prosperity and economic freedom to life
6
Product structure: I. MERCHANDISE A. Primary Products a. Agricultural products 1) Food 2) Raw materials b. Fuels and mining products B. Manufactured Products a. Iron and steel b. Chemicals c. Machinery and transport equipment 1) Office and telecom equipment 2) Transport equipment - Automotive products II. COMMERCIAL SERVICES A. Transportation B. Travel C. Other Commercial Services a. Communications services b. Construction c. Insurance d. Financial services e. Computer services and information
f. royalties and license fees g. other business services The top 3 traders-US, Germany and China, represent 28% of the world’s merchandise trade. Asia accounts for almost 30% of the world merchandise trade.
but none of these episodes approached the magnitude of the 2009 year plunge – (-12 per cent).
1
Asia makes strong merchandise exports: •
recovery
in
•
Europe’s exports of manufactured products grew by 11 per cent in 2010 but this rise was not strong enough to regain the precrisis level. Asian exports of manufactured products grew by 30 per cent in 2010, making up for the loss incurred during the financial crisis. For the Middle East, Africa and the CIS regions, fuels and mining products constitute the main exports, accounting for 68 per cent, 66 per cent and 64 per cent respectively of their total merchandise exports in 2010. •
Within manufactured goods, iron and steel and integrated circuits registered the strongest growth (29.4 per cent and 35.3 per cent respectively). As of 2009, exports of food overtook exports of automotive products. The share of primary products in world trade increased from 22 per cent in 2000 to 30 per cent in 2010.
•
Value of food exports returns to pre-crisis level: • World food exports expanded by 12 per cent in 2010, recovering to the pre-crisis level of US$ 1,118 billion. The European Union, by far the major exporter of food products, increased its exports by only 5 per cent. A 15.4 per cent increase in its exports outside the EU was offset by a modest 2 per cent increase in trade within the EU, which represents the vast majority of its total trade in food. Brazil, the third largest exporter of food, recorded a 17 per cent rise in its exports. Its major export destination was once again Asia.
•
•
Manufactured goods record strongest growth in a decade: • From 2000 to 2010, trade in manufactured goods grew in volume terms by an annual average of 4.8 per cent; increasing by twice as much as fuels and mining products. Trade in agricultural products grew by 3.7 per cent. The average annual growth in trade in manufactured goods, fuels and mining products and agricultural products was higher, however, from 1990 to 2000 (7.2 per cent, 3.7 per cent and 4 per cent respectively). During the past decade, prices of fuels and mining products recorded the highest annual average growth (10.7 per cent), followed by agricultural products (5.6 per cent) and manufactured goods (2.9 per cent).
•
•
EU is the largest importer of fuels and mining products: • China is the second-largest importer of non-fuel minerals, such as iron ores and copper ores, after the European Union. In 2010, non-fuel minerals accounted for almost half of China’s total import bill on fuels and mining products, increasing its share by 10 percentage points since 2000. EU exports of chemicals to countries within the European Union grew by 9 per cent in 2010, while exports to non-EU countries increased by 14 per cent. With exports of US$ 87.6 billion, China overtook Switzerland as the third-largest exporter of chemical products after the European Union and the United States.
•
•
Ores and other minerals show strongest recovery: • The strongest recovery in merchandise trade was for ores and other minerals, which grew by 54.1 per cent in 2010, followed by non-ferrous metals (42.7 per cent).
2
•
Car sector rebounds strongly with 29% growth: • The automotive sector, which saw a 31.5 per cent drop in sales following the financial crisis, rebounded strongly with 29.1 per cent growth in 2010. Mexico became the fourth-largest exporter of automotive products in 2010, increasing its shipments by 54 per cent. Japanese shipments of automotive products to the United States expanded by 36 per cent in 2010 and to China by 51 per cent.
•
Among the major exporters of clothing, India registered a decline of 3.1 per cent.
Europe and Asia are the main providers of commercial services: • World travel receipts totalled US$ 940 billion in 2010, accounting for a quarter of world exports of commercial services. With US$ 385 billion, Europe accounted for 41.1 per cent of total exports (a decline of almost 8 percentage points compared with 2005). Exports of transportation services accounted for 21.3 per cent of global exports of commercial services in 2010, compared with an average share of 22-23 per cent in the last decade. Most exports came from European countries (US$ 374 billion), Asia (US$ 226 billion) and North America (US$ 84 billion). World exports of “other commercial services” totalled US$ 1,970 billion in 2010, accounting for 53.3 per cent of global exports of commercial services. Half of these exports originated from Europe, largely from the European Union. Asia’s share of other commercial services exports increased to 25.4 per cent. North America’s share was 18.2 per cent.
•
•
•
China overtakes EU as major exporter of telecom equipment: • Asia accounted for 63 per cent of world exports of office and telecom equipment in 2010. Based on gross sales of US$ 180 billion, China overtook the European Union as the major exporter of telecom equipment in 2010. The European Union boosted its exports of integrated circuits by 30 per cent, making it the largest exporter if the re-export trade of Hong Kong, China and Singapore are disregarded. •
•
•
China becomes the world’s largest exporter of textiles: • China became the major exporter of textiles in 2010, pushing the European Union into second place. India recorded a 40 per cent increase in its exports of textiles in 2010 to become the third-largest exporting nation, just ahead of the United States. China’s share in world exports of clothing increased to 37 per cent in 2010, rising from 18.3 per cent in 2000, while its share in the country’s total exports declined to 8.2 per cent, from 14.5 per cent in 2000.
3
Trade in services is bouncing back: • World exports of transportation services rose by 15 per cent in 2010, after dropping by 23 per cent during the economic crisis. The recovery was mainly driven by Asia’s exports. World travel receipts grew by 8 per cent in 2010. According to the United Nations World Tourism Organization, the 6.6 per cent surge in global international tourist arrivals in 2010 more than offset the decline triggered by the recession. World exports of financial services increased by 7 per cent in 2010 following a sharp fall during the economic crisis.
•
•
•
•
Insurance services exports stagnated whileexports of computer and information services, and royalties and licence fees increased by 13 and 11 per cent. • Construction exports declined in nearly in all regions in 2010 in the aftermath of the economic crisis. Exports of communications services dropped by 8 per centin value, reflecting a significant drop in prices.
Financial services struggle to recover: • Europe’s financial services sector, the hardest hit by the global crisis, struggled to recover in 2010. Extra-EU exports rose marginally (by 3 per cent), while in Switzerland they declined by 2 per cent. Europe accounted for 49 per cent of global exports of financial services in 2010. US exports of financial services exports expanded by 5 per cent in 2010. Asia experienced a strong recovery in financial services, with Singapore’s exports up by 31 per cent, and Hong Kong’s by 12 per cent. India’s exports grew by 64 per cent but Japan’s fell by 25 per cent.
• •
Most services sectors remain below pre-crisis levels: • Export values of services sectors such as transport and finance remain below precrisis levels despite a rapid recovery in 2010. Exports of transport services totalled US$ 785 billion in 2010, US$ 105 billion less than in 2008. Exports of financial services totalled US$ 265 billion in 2010, down by 10 per cent compared with 2008. Exports of computer and information services rose to US$ 215 billion in 2010, US$ 15 billion higher than in 2008. Global receipts of royalties and licence fees reached US$ 245 billion in 2010, US$ 20 billion higher than in 2008.
•
Travel exports rise rapidly in Asian economies: • Macao became the world’s fifth-largest exporter of travel in 2010, recording a 53 per cent increase in its travel receipts. Thanks to its thriving gaming sector, Macao share in world travel exports has more than doubled in five years, reaching 2.9 per cent in 2010. Exports of travel expanded rapidly in other Asian countries, where the tourism sector experienced very strong growth. China’s travel receipts grew by 15 per cent in 2010, while in Hong Kong the increase was by 35 per cent. Thailand’s travel exports were up by 26 per cent, and in Malaysia they rose by 16 per cent. In the United States, travel receipts grew by 9 per cent, reflecting higher inflows of foreign tourists. In the European Union, travel exports fell by 2 per cent, while in Turkey they stagnated.
•
•
•
Asia’s transportation services achieve strong growth: • Asia’s transport sector rebounded strongly in 2010, with major exporting countries achieving double-digit growth rates. In China, exports rose by 45 per cent, and in the Republic of Korea by 33 per cent. Exports from Hong Kong and Japan expanded by 28 per cent and 23 per cent respectively. Europe recovered at a much slower pace. In 2010, EU exports of transport services rose by 8 per cent, while in Norway, growth was only 2 per cent.
4
•
•
The crisis in construction is not over yet: • Global exports of construction contracted by 1 per cent in 2010, indicating that the effects of the global recession persist.
•
All leading exporters, with the exception of China, recorded negative growth. In the European Union, the world’s leading constructor, exports declined by 7 per cent, and in Japan by 10 per cent. In the Republic of Korea and Russia, the decline was around 20 per cent. China was the only top exporter with strong growth. In 2010, China’s exports of construction expanded by 53 per cent, fuelled by several infrastructure projects especially in Africa.
- Economizing and maintaining stocks (energy). Trade policy: A component part of the broader economic policy of a country which deals with the sphere of foreign economic relations
- Comprises all the regulations adopted by the government with the view to promote or restrict foreign trade and to protect the national economy from foreign competition. Broad goals of the trade policy: To promote foreign economic relations by increasing exports; To protect the national economy from foreign competition by controlling and limiting imports; To equilibrate the trade balance (difference between the value of exports and that of imports).
Openness degree of a national economy: According to the level of involvement in international labor division national economies can be classified as: - Closed economies/autarchies – development is determined exclusively by inward tendencies, minimal foreign economic relations Open economies Indexes measuring openness degree: - Import quota = Import / GDP * 100% - Export quota = Export / GDP * 100% Level of openness depends on:
-
-
Short and medium term objectives: To improve foreign trade structure; To stimulate or restrict trade in certain product groups; To modify the geographical orientation of foreign trade; To increase the purchasing power of exports etc.
Size of the economy Natural resources endowment Structure of national economy (branches) -
Economic security: Optimal level of interaction with the world economy Interdependency can lead to dependency
Trade policy: 1. Tariff instruments (Customs policy) 2. Non-tariff instruments 3. Promotion and stimulation instruments Tariff barriers to trade: Customs duties – main tools
-
Measures taken by government to limit or avoid negative influence of external factors: - Diversification of trade relations (Moldova, China) - Intensification of multilateral cooperation
5
- Revenue and protective customs duties; - Import, export and transit customs duties;
- Ad-valorem, customs duties;
specific,
compound
(mixed)
- Ordinary, conventional, preferential, differential (anti-dumping, anti-subsidy) Non-tariff barriers to trade: - Quantitative restrictions (embargoes, import quotas, licensing, voluntary export restraints) - Restrictions affecting import price (minimum and maximum import price, VAT, import deposit) - Government participation in trade and restrictive practices (government procurement, state trade) - Customs practices; procedures and administrative
by creating 10 benchmarks that gauge the economic success of 183 countries around the world. Trade freedom: Trade freedom is a composite measure of the absence of tariff and non-tariff barriers that affect imports and exports of goods and services Moldova – 80,2 (2011) 79,0 (2012) General characteristics international trade: and trends in
1. International trade is a dynamic flow 2. Developed countries continue to dominate in the international trade relations 3. International trade is regionalized (based on increased institutionalization) 4. Simultaneous decrease of tariffary and rise of non-tariffary protectionism. 5. Internalization of international trade 6. Tripolization of international trade 7. Continuous diversification of international trade flows.
- Technical barriers to trade (sanitary and phytosanitary regulations, security norms, packaging and labeling norms – international standards). Promotion and stimulation measures: 1. Export promotion (international negotiations and cooperation agreements, participating and organizing international exhibitions, establishing agencies and offices abroad etc. ) 2. Export stimulation Budgetary measures (direct and indirect subsidies, export bonus) Fiscal measures (tax exemptions on exported goods, tax exemptions for exporters) Financial measures (export credits) Currency measures (currency national currency depreciation) bonus,
-
-
Index of Economic Freedom: For over a decade, The Wall Street Journal and The Heritage Foundation, have tracked the march of economic freedom around the world with the influential Index of Economic Freedom. Since 1995, the Index has brought Smith's theories about liberty, prosperity and economic freedom to life
6
