We recently compiled a list of The world’s 30 largest economies by 2075 and in this article we will look at which country is expected to be the largest in 2075.
Emerging markets expected to take the lead by 2075
Global potential growth is expected to slow, largely due to slower growth in the labor force, according to a Goldman Sachs study. Projections suggest that global growth will average just under 3% per year and will continue to decline. Global population growth has been halved from 2% per year to less than 1% over the past five decades, and is expected to fall to near zero by 2075. Despite a slowdown in world population growth, Real GDP in developed and emerging economies, emerging markets, particularly in Asia, are expected to continue to outperform developed markets. By 2050, the world’s five largest economies are expected to be China, the United States, India, Indonesia and Germany. You can also view the Top 20 largest economies in the world by 2050.
The United States is not expected to perform exceptionally well due to significantly lower potential growth than large emerging economies. Potential growth in the United States is expected to remain significantly lower than that of large emerging economies such as China and India. The appreciation of the dollar has boosted the value of the U.S. economy, pushing it well above its fair value based on purchasing power parity, but the dollar’s strength is expected to decline over the next decade, suggesting a likely depreciation. Nigeria, Pakistan, and Egypt could also be among the world’s largest economies by 2075 if appropriate policies are implemented. Globalization has significantly reduced income inequality between countries, and emerging markets have led to a more equitable distribution of global income, and global income inequality has declined over the past two decades. However, income inequality within countries has increased, posing a challenge for the future of globalization.
Goldman Sachs’ research also addressed potential challenges related to global economic growth and income convergence. The first is the risk that populist nationalism will lead to increased protectionism and a reversal of globalization. Populist nationalists rose to power in several countries and influenced globalization. However, the risk of a reversal remains evident. Second, the risk of environmental catastrophe due to climate change. Many countries have successfully decoupled economic growth from carbon emissions, demonstrating that this goal is achievable on a global scale. However, achieving sustainable growth will require economic sacrifice and a globally coordinated response, both of which present significant policy challenges.
For the years 2070-2079, emerging economies are expected to grow by 2.3% and continue to outpace developed economies due to productivity growth of only 1.1%. Asia will remain the fastest growing region with growth of 2.0%, but China’s economy is expected to see one of the sharpest decelerations. Growth in Latin American economies is forecast at 1.9% and is expected to grow gradually and accelerate over the next 10 years before slowing again over the following decades. Growth in Central and Eastern Europe, the Middle East and Africa is expected to remain relatively stable at 3.2%, due to an increasing contribution from African economies.
One of the largest companies in Asia
Businesses play an important role as the main economic drivers of economies around the world. PDD Holdings Inc. (NASDAQ: PDD), also known as Pinduoduo Inc., is a leading Chinese company driving economic growth. PDD Holdings Inc. (NASDAQ: PDD), a multinational business group that owns and operates a portfolio of companies, including Pinduoduo, an innovative e-commerce platform that directly connects consumers to small farmers and offers a sourcing, logistics network and fulfillment services. The company also focuses on training farmers and modernizing agricultural practices. PDD Holdings Inc. (NASDAQ: PDD) also operates Temu, an online marketplace that connects consumers to millions of merchandise partners, manufacturers and brands. Temu operates in several countries, including the United States, Australia, New Zealand, United Kingdom, Europe, South Korea and South Africa.
On May 22, PDD Holdings Inc. (NASDAQ: PDD) announced that its revenue for the first quarter ended March 31, 2024 increased 131% to $12.02 billion compared to the prior year. The company’s operating income also increased 275% to $12.02 billion. $3.94 billion, primarily due to an increase in payment fulfillment and processing fees. PDD Holdings Inc. (NASDAQ: PDD) expects Pinduoduo’s revenue to grow strongly by 71% in 2024, and another 29% in 2025. The company is focused on long-term growth and has invested $403.0 million in research and development for agricultural modernization and the supply chain, thereby reducing its costs. The company has $33.31 billion in cash, cash equivalents and short-term investments.
As projections point to a slowdown in the global growth trajectory, emerging markets, particularly in Asia, are shifting the balance of global economic power.
A panoramic view of the cityscape, showing the impact of the company’s operations in China.
Our methodology
To compile our list of the world’s 30 largest economies by 2075, we consulted Fathom Consulting’s “The Economy in 2100,” which provides data on the estimated percentage share of countries in global GDP in 2100 and the PPP GDP of the top ten economies. We used the PPP GDP data for the top countries and the percentage share to determine the total value of global GDP in 2075. Our calculation yielded that global GDP is projected to be approximately $324.34 trillion by 2075. After determining global GDP in U.S. dollars, we estimated the PPP GDP of the remaining countries to give an idea of their projected values. We also used the United Nations’ population projections for 2075. Our list ranks the world’s 30 largest economies by 2075 in ascending order of their projected GDP in 2075.
By the way, Insider Monkey is an investing website that uses a consensus approach to identify the best stock picks from over 900 hedge funds investing in US stocks. The website tracks the movements of corporate insiders and hedge funds. Our top 10 hedge fund consensus stock picks have outperformed the S&P 500 stock index by more than 140 percentage points over the past 10 years (see the details here). So if you’re looking for the best stock picks to buy, you can benefit from the wisdom of hedge funds and company insiders.
The world’s largest economy by 2075
1. China
GDP forecast (2075): $66.16 trillion
Estimated share in global GDP (2075): 20.39%
Population forecast (2075): 1.02 billion
China’s economic transformation is one of the most remarkable achievements among middle-income countries. By 2075, China will be the world’s largest economy driven by manufacturing, exports, and investment in technology and infrastructure. China’s GDP is expected to reach $66.16 trillion, accounting for 20.39% of the global economy. China has already surpassed the United States as the largest economy in purchasing power parity (PPP). China’s population is expected to decline to 1.02 billion by 2075.
Want to know more about which other countries will become the largest by 2075? Check out our report on The world’s 30 largest economies by 2075.
At Insider Monkey we delve into a variety of topics, from the best places to live in Germany to business aspects; however, our expertise lies in identifying the best performing stocks. Currently, artificial intelligence (AI) technology stands out as one of the most promising areas. If you’re looking for an AI stock that’s more promising than NVDA but is trading at less than 5x earnings, check out our report on the stock cheapest AI stock.
READ NEXT: Analyst Sees New $25 Billion ‘Opportunity’ for NVIDIA and 10 stocks to buy and sell before the third quarter of 2024 according to Jim Cramer.
Disclosure: None. This article was originally published on Initiate Monkey.