BUCHAREST (Romania), February 16 (SeeNews) – Romania has improved its economic freedom ranking but needs to make its regulatory system more predictable and ensure steady progress in improving the business environment, The Heritage Foundation said on Thursday.
Romania climbed 22 places in the 2017 Index of Economic Freedom published by the U.S.-based think-tank, ranking 39th with a score of 69.7 points from a maximum 100, The Heritage Foundation said on its website. In Southeast Europe (SEE), Romania ranks second in the annual index after Macedonia, which is in 31st place with a score of 70.7 points.
"Romania continues to recover from the recent global economic slowdown and has made fiscal sustainability a priority. Economic growth rates have improved, but the benefits have not been felt by all Romanians. The country continues to have the highest poverty rate in the European Union," the foundation said.
Also, progress in implementing reforms and improving the business environment has been uneven in Romania, with one of the major drawbacks being the unpredictable and uneven regulatory system, which discourages foreign investors from doing business in Romania.
"Efforts to privatize state-owned enterprises have stalled in the past two years. Corruption is endemic at all levels of government and undermines the rule of law," the think-tank said.
The Economic Freedom Index covers 10 freedoms – from property rights to entrepreneurship – in 186 countries, through 12 quantitative and qualitative factors, grouped into four broad categories: Rule of law, Government size, Regulatory efficiency and Open markets.
Data from the second half of 2015 and the first half of 2016 was used to compile the 2017 edition of the index.
In terms of the rule of law, the foundation notes that the inadequately resourced Romanian courts suffer from chronic corruption and political influence.
Regarding regulatory efficiency, Romania's enforcement of commercial regulations is not always consistent, and efficient procedures and rules for bankruptcy have not been fully implemented.
Even though the government does not screen or discriminate against foreign investment, the regulatory and judicial systems in Romania may be deterrent, according to The Heritage Foundation.
The top three countries in the 21th annual Index of Economic Freedom are Hong Kong, Singapore and New Zealand.