The 2016 Index of Economic Freedom is in a state of imbalance with regards to the rankings assigned to the Gulf states. The best and worst rankings are for Bahrain and Saudi Arabia — at 18th and 78th, respectively out of the 178 economies that were tracked.

Of the Gulf economies, previous report have generally tended to be generous with Bahrain. Not surprisingly, the authorities in Bahrain use this as evidence of its standout status among regional economies.

The Heritage Foundation and the ‘Wall Street Journal’, known for embracing conservative positions, publish the annual report, which stresses the importance of the private sector and market economy. The index relies on numerous variables dealing with economic freedom.

The categories comprise of the rule of law, property rights and freedom from corruption; regulatory efficiency, specifically business, labour and monetary freedom; limited government, essentially governmental spending and fiscal freedom; and open markets or trade, investment and financial freedom. In turn, each variable carries 10 points on a 100-point maximum scale.

Understandably, no GCC member state is regarded as totally free. That exclusive club is made up of Hong Kong, Singapore, New Zealand, Switzerland and Australia.

Yet, three GCC states — namely Bahrain, the UAE and Qatar — are classified as mostly free. The three share attributes like freedom of fiscal and monetary policies, reflecting near absence of taxation and interference in setting interest rates.

To be sure, interest rates prevailing in the US serve as guidelines for rates in GCC countries, reflecting the practice of linking local currencies to the dollar. In fact, Kuwait is the sole GCC country that links its currency to a basket of currencies dominated by the dollar. Linking regional currencies to the dollar is an economic choice for GCC countries, in turn a consideration of conservative policies.

The index, however, conveniently overlooks the fact that the GCC excels in labour freedom like nowhere else in the world, whereby foreigners constitute a majority of the local workforce in all member states.

No major surprises are spotted in the rankings of GCC economies in the 2016 report. Bahrain maintains its global ranking in the index, which puts it ahead Luxembourg, Japan and Finland.

The UAE remains unchanged at 25th globally, despite earning additional marks. Points of strengths for the UAE include freedom of trade, business and labour. A strong presence of workers from all over the world is a plus for the UAE’s ranking. Still, one drawback concerns strong government spending reflecting the pivotal role of public spending by some emirates and more so than others.

Furthermore, Qatar continued experiencing a slide in its ranking, by a further two notches and now at 34th worldwide. Ostensibly, the disturbing trend relates to heavy public involvement in projects dealing with preparing the country for the World Cup 2022. Among the mega infrastructure projects is a rail system.

Oman progressed by four notches to 52nd globally. Measures like curtailing subsidies to streamline fiscal management are aiding the sultanate’s ranking.

Kuwait managed to maintain its ranking, thereby ending the practice of conceding positions.

Clearly, the report granted its rankings ahead of wide-ranging governmental moves to re-engineer subsides for strategic products like fuel. Such moves are popular with the conservatively minded index, suggesting less public interference in setting prices and therefore allowing the forces of supply and demand to function freely.

The rankings of GCC economies should possibly enhance in the years ahead.

The writer is a Member of Parliament in Bahrain.