You might be surprised how much the economic landscape is going to change in the next 30 years. To help us mere mortals HSBC has used a complex but fascinating analysis of economic systems, industries, infrastructure and serious number crunching, to project 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 richest in 2050.
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 healthy banking system (deemed by experts to be one of the most resilient in the world).
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). As a result, it has dropped three places in the economic league table to ninth position, surpassed by countries such as Mexico, India and Brazil.
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.
Brazil is a surprise entry in the top ten – given its past experiences of inflation levels of over 500 percent. With a GDP projected at $2.96 trillion and a per capita income of $13,547, Brazil will be the seventh-most powerful 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. It won’t be all sunshine and carnivals though: the country’s per capita income is expected to drop from 52nd place to 61st.
6. United Kingdom
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, although the long-term consequences of Brexit are harder to predict.
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, in terms of population, as the UK that’s pretty impressive.
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).
The shrinking working population is also expected to 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, while attracting more workers from abroad may be another option.
India will become the third-largest 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. Its income growth rate is set to overtake China’s after 2030 partly as a result of China’s one-child policy, 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.
2. United States
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 other developed economies 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’.
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. However, it will no longer be the most populous country in the world – that can be a plus or minus depending on your own poin t of view.
The full report contains some fascinating, surprising conclusions: nearly two-thirds of the largest economies will be from “emerging markets”: such as Venezuela, Mexico, Turkey, and Egypt. Countries with large populations will do very well economically; many small 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.
See also: Top 10 Benefits of Working Abroad
What are your comments about the report? Share them in the comments below...
This article was originally published in June 2015.