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The United States dropped more than 20 spots, to 44th place, mainly because of the imprisonment of New York Times reporter Judith Miller and judicial action that was "undermining the privacy of journalistic sources," the statement said.
The top 10 countries on the list are European, led by Denmark, Finland, Ireland, Iceland, Norway and the Netherlands, where "robust press freedom is firmly established."
A growing number of African and Latin American countries earned higher rankings, including Benin, which ranked 25th, and El Salvador, 28th.
Nine states that have had independence (or recovered it within the past 15 years) are among the top 60 countries - Slovenia (9th), Estonia (11th), Latvia (16th), Lithuania (21st), Namibia (25th), Bosnia-Herzegovina (33rd), Macedonia (43rd), Croatia (56th) and East Timor (58th).