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Under Colombian president Gustavo Petro, the country’s economy has gone from “Moderately Free” to “Mostly Unfree,” according to the latest Index of Economic Freedom from Heritage Foundation. (Photo: Juan Diego Cano/Colombian President’s Office)
Wednesday, March 13, 2024

Latin America: Economic, Political Freedoms Decline

Colombia sees worst decline in economic freedom in Latin America.


Latin America’s economic and political freedoms have worsened the past year, according to new data from The Heritage Foundation and Freedom House.

According to the Index of Economic Freedom from Heritage, Colombia saw a dramatic 3.9 point decline in its score (the worst decline in Latin America) and now no longer ranks as “Moderately Free” but instead as “Mostly Unfree.”

The South American country’s business climate has suffered after radical leftist Gustavo Petro assumed office in August 2022.

The index measures economic freedom based on 12 quantitative and qualitative factors, grouped into four broad categories, or pillars, of economic freedom: Rule of Law (property rights, government integrity, judicial effectiveness); Government Size (government spending, tax burden, fiscal health); Regulatory Efficiency (business freedom, labor freedom, monetary freedom); and Open Markets (trade freedom, investment freedom, financial freedom).


Economic Freedom Index
LA GL Country Score Ch 24/23 Status
1 21 Chile 71.4 0.3 Mostly Free
2 27 Uruguay 69.8 -0.4 Moderately Free
3 37 Costa Rica 67.7 1.2 Moderately Free
4 49 Peru 64.8 -1.7 Moderately Free
5 52 Panama 64.1 0.3 Moderately Free
6 58 Dom. Rep. 62.9 0.3 Moderately Free
7 63 Guatemala 62.4 -0.3 Moderately Free
8 68 Mexico 62 -1.2 Moderately Free
9 80 Paraguay 60.1 -0.9 Moderately Free
10 84 Colombia 59.2 -3.9 Mostly Unfree
11 89 Honduras 58.6 -0.1 Mostly Unfree
12 115 Ecuador 55 Mostly Unfree
13 117 El Salvador 54.4 -1.6 Mostly Unfree
14 122 Nicaragua 53.4 -1.5 Mostly Unfree
15 124 Brazil 53.2 -0.3 Mostly Unfree
16 145 Argentina 49.9 -1.1 Repressed
17 165 Bolivia 43.5 0.1 Repressed
18 174 Venezuela 28.1 2.3 Repressed
19 175 Cuba 25.7 1.4 Repressed
Average 56.1 -0.4 Mostly Unfree


LA= Latin America rank; GL=Global rank

Sources: Heritage Foundation, Economic Freedom Index 2024; Latinvex (Latin America ranking)

Argentina also worsened and went from “Mostly Unfree” to “Repressed.” With its new libertarian president Javier Milei (who assumed office in December) that will likely change in next year’s ranking.

However, three other countries showed worse declines in their scores than Argentina, while not changing their classification. Peru’s score fell 1.7 (but it still is classified as Moderately Free), El Salvador’s fell by 1.6 points, while Nicaragua’s score fell 1.5 points (the latter two kept their Mostly Unfree status).

Chile remains the freest economy, followed by Uruguay. But Uruguay’s score fell enough that the country went from “Mostly Free” to “Moderately Free.”


Political freedom declined in Latin America, with five countries being among the worst laggards worldwide, according to the latest Freedom in the World from US-based Freedom House.

Peru, Ecuador, El Salvador, Guatemala and Nicaragua were among the countries that saw the worst declines in political freedom last year.

“Leaders in El Salvador and Venezuela bent the rules to ensure their own victories in planned contests,” Freedom House says. “Ecuador’s elections were marred by widespread violence, including the murders of several state officials and political candidates. As a result, that country declined from Free to Partly Free status.”

The manipulation of elections was one of the leading causes of the global decline in freedom in 2023.

“Among the most shocking were efforts to overturn the outcome of an election after the fact,” it says. “This happened in Guatemala, Thailand, and Zimbabwe, where attempts were made to keep winning candidates and parties from assuming office.”

Political Freedom
PR=Political Rights,
CL=Civil Liberties
Rank Country PR CL Total Status
1 Uruguay 40 56 96 Free
2 Chile 38 56 94 Free
3 Costa Rica 38 53 91 Free
4 Argentina 35 50 85 Free
5 Panama 35 48 83 Free
6 Brazil 30 42 72 Free
7 Colombia 31 39 70 Free
8 Dom. Rep. 27 41 68 Partly Free
9 Ecuador 29 38 67 Partly Free
10 Peru 27 39 66 Partly Free
11 Bolivia 27 39 66 Partly Free
12 Paraguay 26 37 63 Partly Free
13 Mexico 27 33 60 Partly Free
14 El Salvador 21 32 53 Partly Free
15 Honduras 22 26 48 Partly Free
16 Guatemala 17 29 46 Partly Free
17 Nicaragua 4 12 16 Not Free
18 Venezuela 1 14 15 Not Free
19 Cuba 1 11 12 Not Free
Average 25 37 62 Partly Free
Sources: 2024 Freedom in the World, Freedom House; Latinvex (ranking by scores, average)


A similar bid to clear the field of viable opposition candidates was well underway last year in Venezuela, ahead of a presidential election planned for 2024.

Opposition forces organized an independent primary to find a unity candidate who would run against authoritarian ruler Nicolás Maduro, the incumbent since 2013.

“Not only did the Supreme Court ban the winner, María Corina Machado, from participating in elections, but a court also ordered the suspension of the entire primary process, in which 2.4 million people had participated, and authorities threatened the organizers with criminal prosecution,” Freedom House points out. “During the primary, state-owned internet providers blocked access to information about where people could vote.”

Meanwhile, Freedom House has not made any changes to the Dominican Republic’s “Partly Free” status despite dramatic changes after Luis Abinader replaced the authoritarian Danilo Medina as president in 2020.

Under Abinader, the attorney general’s office gained strong independence and started a series of probes that led to charges against corrupt officials of the past Medina and Leonel Fernandez administrations.

The Dominican Republic led the way in reducing corruption in Latin America, according to the latest Corruption Perceptions Index from Germany-based watchdog Transparency International. The Dominican Republic improved its transparency score by three points and now ranks 8th in Latin America, up from 12 in 2022.

“The Dominican Republic…is the only country in the region that has made significant progress in the fight against corruption since 2021,” Transparency says.

During his keynote address at the Summit for Democracy 2023, US President Joe Biden praised the Dominican Republic for its efforts to fight corruption.

Press freedom has also been strengthened. In the latest Chapultepec Index from the Inter-American Press Association, the Dominican Republic ranked as the only Latin American country with full press freedom. By comparison countries like Chile, Costa Rica and Uruguay had “low restrictions,” the IAPA said.

In a statement, Freedom House says that the Constitutional Court’s 2013 decision to strip hundreds of thousands of Dominican-born descendants of Haitian migrants of their citizenship, “ongoing and systemic corruption, violations of due process rights, and violence and discrimination against women” and a total ban on abortion are the reasons it has decided to maintain its classification of the Dominican Republic as “Partly Free.”


The ratings of Panamanian banks will come under pressure in 2024 from the Negative sovereign Rating Outlook and from challenges in the banking operating environment within a context of less headroom for asset quality deterioration, Fitch Ratings says.

“The banks’ main challenges relate to economic slowdown, high financing costs and persistent pressures on loan quality stemming from clients’ ongoing pandemic recovery,” it says.

Fitch has revised its 2024 GDP growth forecast for Panama to 1.5% from 4.5%, while the slowdown in credit growth will continue.

“There is also uncertainty related to the presidential elections in May 2024 and how the future government will face fiscal challenges, social security sustainability, the copper mine closure and the Panama Canal drought within the context of potential social unrest,” Fitch warns. “Renewed social unrest, which involves street closures, could negatively impact the business operations and credit growth prospects, a scenario that could further increase the already material challenges faced by local banks.”

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