In our exploration of the future, we’ve delved into the fascinating realm of global economic dynamics, forecasting the 20 largest economies by the year 2050. But if you’re eager to cut to the chase, feel free to jump straight to our top 5 predictions.
Our journey begins in the heart of London, at the headquarters of our own professional services network.
We’re proud to stand among the world’s leading accountancy firms, and in 2017, we embarked on a bold project: The World in 2050. This report was our attempt to gaze into the crystal ball of the world’s economic future, three decades down the line.
Our projections suggest a seismic shift in the global economic landscape. We anticipate the global economy will surge by 130% by 2050, with China commanding a 20% share of the world’s GDP in purchasing power parity.
We predict India will leapfrog the United States, the current economic titan, while the EU’s share of global GDP may shrink below 10%. The Emerging 7, or E7, economies are set to outpace the advanced G7 economies, largely due to a projected decline in the working age population of the G7 economies between 2016 and 2050.
This potential shift is monumental, especially considering that in 1995, the E7 economies were half the size of the G7 countries. These predictions underscore the growing consensus that the 21st century will be dominated by Asia.
Corporations have always been instrumental in driving economic prosperity. A report from our own research institute highlighted that the business sector contributed 72% of the total share of the GDPs of OECD member nations.
This includes the United States, where in 2017, corporations contributed $14 trillion to its total GDP of $20 trillion. To put this into perspective, Apple Inc.’s 2022 revenue of $394 billion was higher than the GDP of most economies in the world, and accounted for more than 1.5% of the United States’ nominal GDP of $25 trillion.
Over recent years, we’ve observed a trend of major corporations like Apple Inc., Microsoft Corporation, and Alphabet Inc., among others, shifting their operations to Asian countries.
This is not just due to the availability of affordable, skilled labor, but also the immense market potential in Asia, home to over half of the world’s population. The World Bank classifies 80% of Asian developing economies as middle income, and 15.6% as high income.
China, Asia’s largest economy, is projected to be the world’s largest economy by 2050. Today, 95% of Apple Inc.’s products are manufactured in China, which also accounted for about 20% of the company’s revenue in 2022. Apple Inc. is also making strides in India, with the inauguration of their first retail store in Mumbai earlier this year.
Microsoft Corporation has been ramping up its investments in Asia, setting up a datacenter in Indonesia in 2021, which is expected to boost its revenues by over $6 billion. Alphabet Inc.’s Google also plans to open a new datacenter in Japan by 2024, worth $690 million. In 2018, it invested $550 million in JD.com, a Chinese e-commerce company, to expand its presence in the Asian markets.
Asian corporations themselves contribute an estimated $19 trillion to the global economy each year. In June 2024, we ranked India’s Tata Group among the world’s largest companies. Reliance Industries Limited surpassed Alibaba Group Holding Limited, BMW, Nestle, Procter & Gamble, and Sony on our Global 2000 list of the world’s largest public corporations.
Methodology
Our methodology for ranking the top economies of the world by the mid-21st century is rooted in the projections made by our own team at PwC.
However, we believe in the importance of multiple perspectives, so we also consulted forecasts made by The Goldman Sachs Group, Inc. for the biggest economies in the world in 2050 and 2075.
We did encounter some projections that seemed to diverge from the commonly accepted economic forecasts.
Specifically, these were related to Germany, Japan, and the United Kingdom surpassing Brazil in 2050, as well as the US surpassing India. To resolve these discrepancies, we turned to another source: the Carnegie Endowment for International Peace.
In 2009, the Carnegie Endowment released a report on the projected state of the G20 economies in 2050. Their estimates aligned more closely with our own at PwC. Therefore, we decided to proceed with our article using the rankings from our PwC projections.
Complete List
| Country | Projected GDP at PPP (in trillion) |
|---|---|
| Vietnam | $3.18 |
| Philippines | $3.34 |
| South Korea | $3.54 |
| Iran | $3.90 |
| Pakistan | $4.24 |
| Egypt | $4.33 |
| Nigeria | $4.35 |
| Saudi Arabia | $4.69 |
| France | $4.71 |
| Turkey | $5.18 |
| United Kingdom | $5.37 |
| Germany | $6.14 |
| Japan | $6.78 |
| Mexico | $6.86 |
| Russia | $7.13 |
| Brazil | $7.54 |
| Indonesia | $10.5 |
| United States | $34.1 |
| India | $44.1 |
| China | $58.5 |
Vietnam Forecasted GDP at PPP: $3.18 trillion
Vietnam, with its projected average annual growth rate of 5.2%, is set to leapfrog 12 spots to claim the 20th position among the world’s largest economies by 2050. The ongoing US-China economic rivalry is expected to benefit Vietnam as US supply chains shift.
Philippines Forecasted GDP at PPP: $3.34 trillion
The Philippines is projected to enjoy an average annual GDP growth of 4.3% until 2050, with a 6.3% growth forecast for 2024. The Asian Development Bank suggests the country is on track to become an upper middle-income economy.
South Korea Forecasted GDP at PPP: $3.54 trillion
Despite being Asia’s fourth largest economy and the 13th biggest globally, South Korea’s share of global GDP is expected to decline due to an aging population and the rise of new economic powerhouses.
Iran Forecasted GDP at PPP: $3.90 trillion
Despite facing severe western sanctions and having one of the world’s weakest currencies, Iran is projected to be among the 20 largest economies by 2050.
Pakistan Forecasted GDP at PPP: $4.24 trillion
Pakistan, the world’s fifth most populous nation, is expected to be among the 20 largest economies in the world by 2050, driven by its youthful population. A Goldman Sachs report from December 2022 even tipped Pakistan to be the sixth largest economy by 2075.
Egypt Forecasted GDP at PPP: $4.33 trillion
Egypt is projected to leapfrog countries like Canada and Italy on a PPP basis by 2050 to become the 15th largest economy globally. Currently, it ranks 32nd among the world’s largest economies.
Nigeria Forecasted GDP at PPP: $4.35 trillion
Nigeria, Africa’s wealthiest country and home to the continent’s largest gas reserves, could rise to become the 14th largest economy globally by 2050, provided it strengthens national institutions, develops infrastructure, and diversifies its economy.
Saudi Arabia Forecasted GDP at PPP: $4.69 trillion
Saudi Arabia, one of the world’s largest oil exporters and a founding member of OPEC, is projected to be the 13th largest economy by 2050.
France Forecasted GDP at PPP: $4.71 trillion
France is expected to drop out of the top 10 largest economies by 2050. Despite this, the French economy will remain strong, albeit growing at a slower pace than some other advanced economies.
Turkey Forecasted GDP at PPP: $5.18 trillion
Despite currency challenges, Turkey’s economy remains robust and on a growth trajectory, with a GDP growth of over 5% last year. By 2050, Turkey’s economy is projected to be the 11th largest in the world.
United Kingdom Forecasted GDP at PPP: $5.37 trillion
The UK, currently Europe’s second largest economy, is expected to slide to the 10th spot by 2050. Despite Brexit, it could grow faster than many other European nations due to its large share of the working age population, according to our report.
Germany Forecasted GDP at PPP: $6.14 trillion
Germany’s population is projected to shrink by 2050, and its investment rate as a percentage of GDP is also expected to decline from 22% in 2016 to 20% as early as 2028. Japan Forecasted GDP at PPP: $6.78 trillion
Japan Forecasted GDP at PPP: $4.5 trillion
Currently the world’s third largest economy with a GDP of $4.5 trillion in 2022, is expected to slide to the eighth position by 2050. The country’s economy, driven by exports in electronics and automobiles, will continue to be a significant player on the global stage.
Mexico Forecasted GDP at PPP: $6.86 trillion
Mexico, one of the leading exporters in Latin America with a current GDP nearing $1.5 trillion, is expected to be among the fastest growing economies in the coming years. As US supply chains shift closer to home, Mexico is projected to rise to the seventh largest economy by 2050.
Russia Forecasted GDP at PPP: $7.13 trillion
Russia, with its vast proven oil and natural gas reserves, is expected to maintain its position among the top ten economies in the world by 2050, securing the sixth spot with a GDP at PPP of $7.13 trillion.
Now, let’s move on to the top 5 economies by 2050.
Brazil Forecasted GDP at PPP: $7.54 trillion
Brazil, with its rich natural resources and large workforce, is projected to rise to the fifth position by 2050. The country’s economy, currently the largest in Latin America, is expected to continue its growth trajectory, driven by domestic consumption and export of commodities.
Indonesia Forecasted GDP at PPP: $10.5 trillion
Indonesia, the largest economy in Southeast Asia, is expected to climb to the fourth spot by 2050. With its young and growing population, strategic location, and abundant natural resources, Indonesia is poised for significant economic growth.
United States Forecasted GDP at PPP: $34.1 trillion
The United States, currently the world’s largest economy, is projected to slide to the third position by 2050. Despite this, the US economy will remain a global powerhouse, driven by technological innovation, a strong institutional framework, and abundant natural resources.
India Forecasted GDP at PPP: $44.1 trillion
India, with its young and rapidly growing population, is expected to leapfrog the United States to become the second largest economy by 2050. The country’s economy is expected to be driven by technological innovation, increasing urbanization, and structural reforms.
China Forecasted GDP at PPP: $58.5 trillion
China, currently the world’s second largest economy, is projected to overtake the United States to become the largest economy by 2050. The country’s economic growth is expected to be driven by technological innovation, a large and growing middle class, and continued urbanization.
FAQ
What is the projected growth of the global economy by 2050?
The global economy is expected to grow by 130% by 2050, according to a report by PricewaterhouseCoopers (PwC).
What is the significance of the E7 economies?
The Emerging 7, or E7, economies are projected to grow almost twice as fast as the advanced G7 economies. This is largely due to a projected decline in the working age population of the G7 economies between 2016 and 2050. The E7 economies include China, India, Indonesia, Brazil, Russia, Mexico, and Turkey.
What role do corporations play in economic growth?
Corporations have a significant role in driving economic prosperity. For example, in 2017, $14 trillion out of the United States’ total GDP of $20 trillion came from the corporate sector. Major corporations like Apple Inc., Microsoft Corporation, and Alphabet Inc. are also shifting their operations to Asian countries, contributing to the economic growth of these regions.
What factors are contributing to the shift in global economic power to Asia?
Several factors are contributing to this shift. These include the availability of affordable, skilled labor in Asian countries, the immense market potential in Asia, which is home to over half of the world’s population, and the projected growth of the E7 economies, most of which are in Asia.
What are some of the challenges that could impact these economic projections?
Several factors could impact these projections, including geopolitical tensions, economic policies, demographic changes, technological advancements, and environmental issues. For example, an aging population in countries like Germany and Japan could impact their economic growth. Similarly, economic policies and geopolitical tensions could impact the growth of economies like Iran and Russia.
How reliable are these economic projections?
These projections are based on current trends and assumptions, and they are subject to change. They are made by reputable organizations like PwC and The Goldman Sachs Group, Inc., but they should be taken as educated predictions rather than absolute certainties. It’s also important to note that different sources may have slightly different projections based on their own methodologies and assumptions.
Final Words
This is a comprehensive report on the projected state of the global economy by 2050. It suggests a significant shift in the economic landscape, with the global economy expected to grow by 130% by 2050.
The report predicts that China will command a 20% share of the world’s GDP in purchasing power parity, and India will surpass the United States. The EU’s share of global GDP may shrink below 10%, and the Emerging 7, or E7, economies are set to outpace the advanced G7 economies.
The report also highlights the role of corporations in driving economic prosperity, with the business sector contributing 72% of the total share of the GDPs of OECD member nations.
Major corporations like Apple Inc., Microsoft Corporation, and Alphabet Inc. are shifting their operations to Asian countries due to the availability of affordable, skilled labor and the immense market potential in Asia.
