By 2050, six of the seven largest economies will be emerging market economies–with China, India and Indonesia leading the way, reveals a global economic outlook report by management consultancy firm PwC.
“Emerging economies such as Mexico and Indonesia are likely to be larger than the U.K. and France,” says the report, “while Pakistan and Egypt could overtake Italy and Canada.” India, for example, is expected to surpass the U.S. as the second-largest economy.
Last year, Canada’s economy ranked 17th, and is projected to rank 22nd by 2050. (Pakistan, ranked 24th, is projected to move up to the number 16 spot, while Egypt, at number 21, is projected to move to 15.) These rankings are based on GDP at purchasing power parity, which measures the volume of goods and services produced in an economy.
Overall, the world economy could more than double in size by 2050, far outstripping population growth, due to technology-driven improvements. However, emerging market economies must enhance their institutions and infrastructure significantly if they’re to realize this growth potential, warns PwC.
Challenges for policymakers include avoiding protectionism, sharing the benefits of globalization equally across society and developing green technologies to ensure environmentally sustainable growth.
For businesses, maturing emerging markets will become less attractive as low-cost manufacturing bases, but more attractive as consumer and business-to-business markets, predicts PwC. And, since emerging markets can be volatile, international investors must be patient enough to ride out short-term economic and political cycles in these countries.
Here’s a look at the 10 largest world economies for 2016 as well as a look at what to expect in 2050.
|Countries with highest 2016 GDP||Rankings||Countries with highest 2050 GDP|
Read the full report here.