NZ fifth on world economic freedom index

New Zealand has regained fifth place on the annual Index of Economic Freedom, having slipped from fifth to ninth spot last year.

The index is compiled by the Wall Street Journal and right wing Washington think-tank the Heritage Foundation.

Hong Kong, for the 13th consecutive year, tops the index which this year uses new methodology, including drawing on previously unavailable World Bank data, and a new rating system.

Ranking countries on a 0-100 scale, Hong Kong is rated on 89.29, followed by Singapore 85.65, Australia 82.69, United States 81.98, New Zealand 81.59 and United Kingdom 81.55. North Korea is a distant 157th and bottom on 3.00.

Economic freedom is measured within 10 categories: business freedom, labour freedom, trade freedom, fiscal freedom, freedom from government, monetary freedom, investment freedom, financial freedom, property rights and freedom from corruption.

Last year the index editors said New Zealand lost ground in the "capital flows and foreign investment" category because proposed legislation would toughen restrictions on foreign ownership of land.

This year the editors said the move toward greater economic freedom worldwide had stalled. They expressed regret, as "13 years of index data strongly suggest that countries that increase their levels of economic freedom experience faster growth rates".