These Countries Will Dominate the World – In 2050
Posted by Ram Kumar Shrestha on June 21, 2015
By Lola Bailey
“By 2050, the collective size of the economies we currently deem ’emerging’ will have increased five-fold and will be larger than the developed world.” – HSBC Global Research
Times, they are a-changing. An economic report by HSBC has predicted a seismic shift in the structure of the global economy, with the economic centre of gravity shifting from the north Atlantic to central Asia – particularly China and India. If the predictions are true (and it must be said that economists are not known for agreeing with each other) the world will look very, very different indeed.
Through a complex but fascinating analysis of economic systems and infrastructure and serious number crunching, HSBC’s analysts’ economics prowess has projected the wealth of countries (GDP and per capita income) in 2050. You can read the full report: The World in 2050; Quantifying the Shift in the Global Economy here.
Read on to discover which countries will be the world’s richest – in 2050:
In 2050, China is expected to be the world’s richest, and probably the most powerful, economy, with a GDP of $24.62 trillion and a per capita income of $17,759. China’s income per capita will still only be roughly a third of that in the US so there is room for considerably more growth. On the minus side, it will no longer be the most populous place on earth – (spoiler alert) that honour will go to India.
The US will be the second richest economy in the world in 2050, with a GDP of $22.27 trillion and a per capita income of $55,134. The projected growth per capita income for the US is lower than it is for other developed economies, however, because its already rich infrastructure “constrains growth”. For so long the richest country on the planet, the US will have to contend with being ‘second best’.
India will become the third richest economy in the world, with a GDP of $8.17 trillion and an income per capita of $5,060. India’s working population is set to explode, fuelling its growth. India’s income growth rate is set to overtake China’s beyond 2030 partly as a result of China’s one-child policy “demographic headwind”, and its economy is projected to grow at an average 5.1% annually between 2040 and 2050. In addition to becoming one of the world’s super-economies, India is also poised to become the most populous country on earth by 2050, overtaking China with a projected 1.6 billion people.
The size of Japan’s economy by GDP will be $6.43 trillion; its income per capita is projected at $63,244. Japan faces demographic challenges of an ageing population and a dramatic decline in working age population (of nearly 40 percent): its shrinking working population that must somehow support an increasing ageing population. Perhaps incentives will be offered to the Japanese people to have more children: the fertility rate here is the lowest on this list of world economies.
Germany will have a projected GDP of $3.71 trillion with a per capita income of $52.683, making it the largest European economy in 2050 (although it has dropped one place from 2015). Given that Germany is roughly the same size, population wise, as the UK, that’s pretty impressive.
The UK’s projected 2050 GDP is $3.58 trillion, with a per capita income of $49,412. The current gap between British economic wealth and that of Germany will narrow significantly by 2050 (from a $346 billion gap to a $138 billion gap), with the UK boosted by a projected year on year percentage growth in the working population. The UK is projected to fall in the economic league table by just one position, so it’s hanging in there.
Brazil is a surprise entry in the top ten – given its past experiences of inflation levels of over 500 percent. With aGDP projected at $2.96 trillion and a per capita income of $13,547, Brazil will be the seventh richest economy on the planet. And it will be a pretty sizeable economy too –Brazil’s population is expected to reach in excess of 200 million mark. It won’t be all sunshine and carnivals though: the country’s per capita income is expected to drop from 52nd place to 61st.
Mexico is the second Latin American entrant to the pantheon of putative economic powerhouses. With a projected GDP of $2.81 trillion and a per capita income of $21,793. Prospects look extremely good for Mexico: its current president Enrique Nieto is spearheading a number of wide-ranging reforms from telecommunications to energy that will boost the country’s long-term productivity and prosperity.
The size of France’s economy will be $2.75 trillion, and it will have a projected per capita income of $40,643. There will be tough times ahead for France though, as it struggles to cope with (continuing) sluggish growth and demographic challenges (decline in working population), and it will drop three places in the economic league table to ninth position, surpassed by countries such as Mexico, India and Brazil.
Canada will have an economy worth $2.29 trillion by 2050 and a projected per capita income of $51,485. That Canada stays put (it remains in tenth position) is to its credit, or to the credit of its renowned strong banking system which is said to be one of the most resilient in the world.
Takeaways from the report
The full report contains some fascinating, surprising conclusions: nearly two-thirds of the largest economies will be from “emerging markets”: markets such as Venezuela, Mexico, Turkey, and Egypt; countries with large populations will do very well economically; many small-population, ageing, currently rich European nations (such as Switzerland, The Netherlands and Sweden) will be the biggest losers and, perhaps unsurprisingly, China will be the world’s largest economy.