Page 31 - bne IntelliNews monthly magazine October 2024

bne October 2024 Cover story I 31
GDP growth for leading economies of the world % y/y
Minister Sheikh Hasina was ousted in August by violent protests.
At the geopolitical level there are also consequences to this game of economic musical chairs. The attempts to sanction Russia’s economy into oblivion have backfired and catalysed China and Russia into beefing up their non-aligned multinational alternative centres of power, such as the BRICS+ and the G20.
Worried by the US decision to weaponise the dollar and freeze international reserves, the countries of the Global South are de-dollarising and flocking to these organisations, simply as a counterweight to an increasingly unpredictable America.
As the leading emerging markets climb up the GDP rankings, the appeal of the Moscow and Beijing-run clubs increases, as not only do they show that sanctions don’t work if enough of the rest of the world ignore them, but that the Global South now represents the richer and faster growing half
of the world. Collectively the BRICS
Top 15 countries GDP in PPP terms
2020
2021
2022
2023
2024 Forecast
Germany
France
Italy
Spain
UK
Russia
China
Japan
Canada
-4.6% 2.6%
-7.9% 7.0%
-9.0% 6.6%
-10.8% 5.5%
-9.3% 7.6%
-2.7% 4.7%
2.2% 8.4%
-4.6% 1.7%
-5.2% 5.0%
1.8% 0.2% 0.6%
2.6% 0.7% 0.9%
3.7% 0.6% 0.8%
5.5% 1.9%
1.5%
4.1% 0.1% 0.6%
-2.1% 3.2% 2.6%
3.0% 5.3% 4.7%
1.0% 0.9%
1.0%
Source: National governments
than in the drubbing it took during the pandemic and the financial crisis of 2008.
In 2023, the combined GDP of the seven leading countries was estimated at 1.5% compared to the previous year. And the EU only just managed to avoid recession in 2023, achieving an average growth rate of a mere 1%. The fastest growing economy in Europe in 2023 was the small Balkan country of Montenegro, which expanded by 4.5%, but almost all the big EU members were growing at less than 1%.
The EU governments and the economic press talk about a European “recovery” that assumes a return to the status
quo and doesn’t acknowledge the fundamental changes that have happened to Europe’s economic makeup as a result of the polycrisis.
The economic pain is already having political consequences that make implementing reforms hard. Across Europe there is a swing to the right, such as AfD’s (Alternative für Deutschland) recent victory in German’s eastern
state regional elections that is splitting German Chancellor Olaf Scholz’s
ruling coalition, and a new right-wing government in France, the most right- wing since the Republic was founded, to name only two recent examples.
While the rich world is getting poorer, the poor world is getting richer and starting to overtake its more advanced peers. Russia overtook Germany to
3.4% 1.5% 1.4%
become the fifth biggest economy in the world in PPP (purchase power parity) terms two years ago and surpassed Japan to become the fourth largest economy in the world in adjusted terms this year. China is now the largest economy in the world in PPP terms, followed by the US and then India
and Russia. Germany has fallen down the rankings and is now number six, while the birthplace of the industrial revolution, the UK, has been pushed out of world's top ten manufacturing nations by Russia and Mexico for the first time in decades.
And with India's GDP growth projected at 8.2% in the current fiscal year 2024- 2025, the country's economy could become the third largest in the world in nominal terms by 2030-2031, S&P Global said on September 19, provided that reforms critical to improving business operations and logistics, stimulating private sector investment and reducing dependence on public capital continue. Both China and India are expected to become number one and two in nominal GDP terms sometime in 2070.
Other up and comers from the EMs include Indonesia and Mexico, which have been shooting up the rankings in recent years. Bangladesh is also
an unsung success story (population 171mn) after per capita GDP in the country overtook that of India in the last few years, until the former was plunged into chaos after its Prime
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2
3
4
5
6
7
8
9
10
11
12
13
14
15
China
United States
India
Russia
Japan
Germany
Brazil
Indonesia
France
United Kingdom
Turkey
Italy
Mexico
South Korea
Spain
34,643.71
27,360.94
14,537.38
6,452.31
6,251.56
5,857.86
4,454.93
4,333.08
4,169.07
4,026.24
3,767.23
3,452.51
3,288.67
2,794.20
2,553.11
Rank
Country
2023 GDP (PPP) ($bns)
Source: World Bank
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