He, however, also emphasized the role of a strong government.
"The state has a role. Without a strong government, the market cannot function well and market reforms cannot be implemented," he said. "Economic freedom must be accompanied by a strong state authority. It must ensure a level playing-field, fair competition and rule of law, protection of labor interest and the environment," Mahat said, speaking at a ceremony held in Kathmandu on Monday to unveil the 'Economic Freedom of the World: 2015 Annual Report'.
"Governments in und-erdeveloped countries try to do many things, but succeed in nothing. The government should focus on areas where it can work effectively," he added.
Speaking at the event, former governor of Nepal Rastra Bank Yuba Raj Khatiwada said that economic freedom alone was not sufficient for prosperity. "Economic freedom provides a condition necessary for prosperity. However, freedom is not sufficient in itself. For freedom to be a sufficient condition, capacity needs to be increased," Khatiwada said underlining the state's role in enhancement of such capacity.
He also said economic freedom should not be from an absolute perspective that measures freedom of only the private sector. "Economic freedom should be relative in that it includes the freedom of all -- including laborers, consumers and entrepreneurs," he added.
Similarly, senior economist Bishwambher Pyakuryal said economic freedom offers an opportunity to work and invest freely for the benefit of self and the nation.
Former finance secretary Rameshore Khanal said the government should make the budget transparent and exercise pre-budget discussions for improving the size of the government and economic freedom.
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