Guatamala Is #63

Guatamala is #63 in Economic Freedom out of 176 Countries.

Every year the Heritage Foundation, a leading U.S. nonprofit, produces the Index of Economic Freedom Report and ranks how free and open each country’s economy is.

With a score of 62.4, El Salvador is classified as "Moderately Free":

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What Does Being “Moderately free” Mean for Guatamala?

Guatemala’s "Moderately Free" classification on the Index of Economic Freedom highlights a relatively open economy with strong fiscal policies and trade freedom but also underscores limitations within its legal and institutional frameworks. For the average Guatemalan, this means favorable tax and spending policies, yet persistent issues with corruption and legal protections that can limit economic stability and trust in public institutions

What categories doES Guatamala DO well in?

To do well ("mostly free") a country must score 70 - 79.9. To classify as excellent ("free") a country must score 80 or higher. Guatamala scores relatively well in these areas (scores out of 100):

Government Spending 93.7
Tax Burden 91.3
Fiscal Health 87.5
Trade Freedom 75.0
Monetary Freedom 74.6
Investment Freedom 70.0

Solutions

Guatamala's three worst performing categories:

Government Integrity 22.8
Judicial Effectiveness 27.9
Property Rights 38.8

The lowest-scoring category, Government Integrity, stands at 22.8 out of 100, reflecting widespread issues with corruption and a lack of transparency in government operations. This score affects citizens by undermining confidence in public officials, leading to inefficiencies and misuse of resources that hinder public service quality. To improve government integrity, Guatemala could adopt stricter anti-corruption laws, implement transparent governance practices, and strengthen accountability mechanisms to regain public trust.

Judicial Effectiveness in Guatemala scores 27.9 out of 100, indicating weaknesses in the country’s legal framework and the consistent enforcement of laws. For Guatemalans, this low score translates to challenges in accessing fair and reliable legal recourse, which can discourage investment and make property ownership risky. Enhancing judicial effectiveness would involve judicial reforms to increase independence, provide legal training, and ensure transparent and efficient case processing.

Property Rights score 38.8 out of 100, showing limited protection for ownership and challenges in securing property investments. This impacts citizens by making it difficult to securely invest in real estate or businesses, which limits opportunities for wealth-building. Strengthening property rights would require legal reforms to protect ownership, streamline property registration, and establish effective legal support for resolving property disputes.

Guatamala's Economic Freedom over time:

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