The United States of America could lose its position as the world's largest economy as early as next year. A downfall that would be tremendously difficult to come back from as developing Asian economies gain momentum and move ahead.
Despite recent problems with trade, China's economy is still pushing forward. According to research released this week by Standard Chartered Bank, it's likely that China will become the world's biggest economy at some point in 2020, when measured by nominal gross domestic product and purchasing-power-parity exchange rates. Shortly after being surpassed by China, the US is predicted to fall into third place as India becomes a dominating economy by 2030. Standard Charter says "India will likely be the main mover, with its trend growth accelerating to 7.8% by the 2020s partly due to ongoing reforms, including the introduction of a national goods and services tax (GST) and the Indian Bankruptcy Code,"
As illustrated in the graph above, six of the ten largest economies could be in Asia by 2030. Included in that prediction, Asian GDP will account for roughly 35% of global GDP, up from 28% last year and 20% in 2010.
Gross Domestic Product (GDP) is used to measure the market value of products and goods in an economy. Nominal GDP estimates are used to determine economic performance of a country. GDP (nominal) does not reflect differences in the cost of living, and the inflation rates of the countries. When combined with Purchasing Power Parity (PPP), the two can be useful to determine the living standards of nations.
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Coty White is a journalist at GoldenGOAT Articles that specializes in business, travel, lifestyle, innovation and the environment. Aside from his time spent as a reporter, he is an active stock trader and current owner of four successful companies.