WASHINGTON, DC — September 25, 2025 — Today, the Cato Institute, in partnership with the Fraser Institute in Canada , releases the Economic Freedom of the World: 2025 Annual Report. The 30th annual edition provides a comprehensive, data-rich analysis of the state of economic freedom around the globe.

The 2025 edition ranks 165 countries and territories based on key indicators such as rule of law, property rights, sound money, freedom to trade internationally, and regulatory burden. These rankings reflect the extent to which individuals are free to make their own economic decisions.

“The decline in global economic freedom in recent years represents notable infringements on basic human rights such as choice and voluntary exchange,” said, Ian Vásquez, vice president for international studies and director of Cato’s Center for Global Liberty and Prosperity. “It is additionally worrisome because economic freedom is strongly linked to better health outcomes, greater prosperity, more political freedom and improvements in the whole range of human well-being.”

Key findings include:

  • Hong Kong remains top-ranked, but has declined since 2018, especially in regulation, legal system, and property rights, following the 2020 national security law that ended the city’s autonomy.
  • The United States is ranked 5th. The rankings of other major world economies include Canada (11th), the United Kingdom (13th), Germany (15th), Japan (17th), Korea (38th), France (44th), Italy (46th), Indonesia (65th), Mexico (70th), India (86th), Brazil (87th),
  • China (108) and Russia (148) rank near the bottom, reflecting deep weaknesses in all of the broad areas measured.
  • Global economic freedom had been rising since 2000, but COVID-19 policy responses erased nearly a decade of gains.
  • Nations in the top quartile average $66,434 GDP per capita and 79-year life expectancy, compared to $10,751 and 62 years for countries in the bottom quartile.
  • Using US tariff data from 2025, the report estimates that Trump’s tariffs would drop the United States from 56th to 76th in freedom to trade—nearly pushing the country out of the top 10 in overall economic freedom.

The main authors of the report are Robert Lawson and Ryan Murphy from Southern Methodist University.

For more information or to download the full report and country-level data, visit Cato’s Economic Freedom of the World 2025 page.