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They mention that civil liberties remain restricted on the site. Their economic freedom, regulatory burden, intl trade etc, however, is on par with some of the freest in the world.
Call the index out on its methodology if you want, but its not likely that they worked backward to find the highest GDPs per cap and messed around with the data to fit in economic freedom to correlate.... that would seem rather odd.
It's a ranking of "economic freedom" in their own terms, but Singapore is the perfect example of how that definition doesn't equate to small or non-intrusive government.