Taiwan maintains 4th position in 2025 global economic freedom index

　As reported in the press release issued by the National Development Council of Taiwan, the Washington, D.C-headquartered think tank, The Heritage Foundation released the 2025 Index of Economic Freedom report on March 3, 2025, and according to the report, Taiwan maintained its global ranking at the 4th place among 184 economies and ranked 2nd in the Asia-Pacific region, trailing only Singapore (1^st), Switzerland (2^nd), Ireland (3^rd) and ahead of Australia (6^th), New Zealand (11^th), South Korea (17^th), the U.S. (26^th), Japan (28^th), the U.K. (33^rd), and China (151^st).  

　According to the report, the ill-advised economic policy choices during the COVID-19 pandemic period, high inflation, Russia’s ongoing invasion of Ukraine, broader conflict in the Middle East, as well as other economic and geopolitical tensions not only risks economic recovery but also poses many long-term structural challenges to all countries in the policy areas of transparency, efficiency, openness, and government effectiveness.  With a total average score of 79.7, which is a drop of 0.3 points from the 2024 score of 80, Taiwan has remained at the 4th position globally for the third consecutive year

　Taiwan was marked as “free” (100-80 scores) in five of the 12 categories, which are “judicial effectiveness” (94.4), “fiscal health” (91.3), government spending (90.1), “trade freedom” (86.6), and “property rights” (83).  Among these indexes, Taiwan has improved its score in “judicial effectiveness” from 70.1 in 2020 to 94.4 in 2025, a lead of 24 points that marks Taiwan’s best performance in the past five years.  Taiwan also made progress in the indicators of “fiscal health”, “trade freedom”, and “property rights”.  

　Besides, Taiwan ranked among the world’s top 20 in five indicators, which are “trade freedom” (5^th), “monetary freedom” (8^th), “judicial effectiveness” (13^th), “labor freedom” (17^th), and “government spending” (20^th).  Also, in 2025, Taiwan’s global rankings also advanced in the indexes of “trade freedom” (from 7^th to 5^th), “investment freedom” (from 38^th to 28^th), and “financial freedom” (from 37^th to 35^th).  

　Taiwan’s legal regime has undergone several reforms from 2023 through 2024.  For example, the Electronic Signatures Act is amended to promote the popularization and legal effectiveness of electronic signatures.  The amended Trademark Act introduces the accelerated examination of trademark registration applications and establishes the management system of trademark agents.  Moreover, a dedicated section for annual legislative plans of draft regulations is created to enhance transparency of the formulation process of regulations and orders.  Moreover, the Guidelines for Artificial Intelligence (AI) Applications in the Financial Industry is released to encourage the financial industry to adopt, use, and manage AI system under controlled risks.  Revisions of the Financial Consumer Protection Act are made to complete legal regulations for the financial services and strengthen information disclosure.  

　With global inflation gradually subsiding, global economic vitality is picking up. However, the current increasingly volatile landscape is posing unprecedented challenges to Taiwanese businesses, not only in technological advancement but also in pursuit of multiple goals of digital transformation, resilience strategies, and sustained development.  Based on its commitment to economic liberalization, the government will assist enterprises in adapting to innovative business models and reorienting their strategic direction, enabling them to manage potential risks, capitalize on growth opportunities, and ensure Taiwan’s international competitiveness in the shifting global economic landscape.  (Released 2025.03.04)
/CCS