Malaysia is ranked 71st among 144 countries in the Economic Freedom of the World: 2012 Annual Report, released today by the Institute for Democracy and Economic Affairs (Ideas).

The report is produced in partnership with Canada's Fraser Institute and 86 other think tanks globally.

Malaysia made good progress as it vaulted to 71st spot this year from 78th in 2011, Ideas Chief Executive Wan Saiful Wan Jan said in a statement here.

"This is actually a very important report for Malaysia because it measures our performance in the year after Prime Minister Datuk Seri Najib Tun Razak announced the New Economic Model (NEM) and the Economic Transformation Programme (ETP)," he added.

The Economic Freedom Index always has a lag of two years due to the delay in global data release. The report that we are now releasing measures our performance in 2010, Wan Saiful said.

"Our improvement in the ranking shows that the government's economic agenda has successfully halted our ranking decline for the last few decades.

"I believe the NEM and ETP has produced a positive impact on the level of our economic freedom," he added. Wan Saiful hoped the government will remain committed to the liberalisation spirit of the NEM.

He said the government must also avoid the tendency to offer populist handouts and subsidies as the general elections come closer because it has a negative impact on Malaysia's standing globally.

The report this time also found that a more liberal economic system is positively linked to higher income per capita and economic growth, he said.

"This means that we can possibly improve the life quality of the poorest in Malaysia if we remain committed to further liberalising our economy," Wan Saiful said.

Hong Kong again topped the rankings of 144 countries. The rankings of other large economies includes United States (18th), Japan (20th), Germany (31st), France (47th), Italy (83rd), Russia (95th), Brazil (105th), China (107th), and India (111th). -- Bernama