Top 10 Economies In the World

Top 10 Economies In the World

The top 15 economies add up to over 75% of the world’s economy leaving 172 countries to make up the remaining 25%. It is a concerning statistic and it is no surprise which of these countries feature in the top 10 based on their gross domestic product (GDP)

This is a list of the top 10 economies based on GDP as of June 2016:

  1. The United States
  • The United States have one of the world’s biggest economies boasting a cool $17.95 trillion ultimately making up approximately 24.5% of the gross world product.
  • With some of the best technology, infrastructure and natural resources, the U.S has managed to remain a superpower of the world in regards to their economy.
  • China’s GDP is $19.4 trillion and the U.S. GDP is $17.95 trillion. However, the U.S. is way ahead of China in terms of GDP Per Capita (PPP).
  • The U.S. economy loses its spot as the number one by a small margin to China when measured in terms of PPP.
  1. China
  • China has bridged the gap tremendously to the United States by manufacturing and exporting over the past 40 years.
  • Nominal GDP remains the difference between China and the United States.
  • China is currently a $10.98 trillion economy and has been growing by 7% in the recent years, although that growth is halting.
  1. Japan
  • Struggling since 2008, the Japanese Government’s stimulus packages have helped the economy recover a bit, but the massive earthquake in 2011 was disastrous.
  • Economic growth is forecasted to stay below 1% during the next six years.
  • Japan is sitting at $4.83 trillion.
  1. Germany
  • Sitting first in Europe and fourth overall, Germany is known for its exports of machinery, vehicles, household equipment, and chemicals.
  • Germany his facing ongoing demographic challenges like most European nations.
  • It has a value of $3.84 trillion and is expected to sit between 1 and 2% in the coming years.
  1. UK
  • The United Kingdom, with a $2.85 trillion GDP.
  • The economy of the UK is driven by the services sector as it contributes more than 75% of the GDP.
  • The outcome of Brexit could result in a loss of anywhere from 2.2-9.5% of GDP depending on a range of other factors.

Rounding out the top 10

France ($2.42 trillion)

India ($2.09 trillion)

The GDP measured in purchasing-power-parity for the economy is estimated at $2.17 trillion

Brazil ($1.77 trillion)

Canada ($1.55 trillion)

Other nations boasting high numbers just outside of the top 10: Russia ($1.32 trillion), Australia ($1.22 trillion), Spain ($1.2 trillion), and Mexico ($1.14 trillion).

There will be a similar piece in the third quarter of this year!

FDI Inflows By Nation During 2015

FDI Inflows By Nation During 2015

If we look at the top 10 host economies by nation during 2015 it is evident there is a big margin between world superpowers. The data, derived quarterly, presents us with figures displaying the Billions of U.S. dollars spent per nation to determine foreign direct investment inflows.

Here they are, from 10th to 1st:

10. France ($44 Billion)

9. Canada ($45 Billion)

8. Brazil ($56 Billion)

7: India ($59 Billion)

6. Singapore ($65 Billion)

5. The UK ($68 Billion)

4. Netherlands ($90 Billion)

3. China ($136 Billion)

2. Hong Kong ($163 Billion)

1. U.S ($384 Billion)

The most noticeable fact is a big chunk of the countries are from Asia (HK, China, Singapore and India) with 4/10 nations. There are 3 nations from Europe featuring in the top 10 and it is no surprise North and South America make up the rest of the top 10. These are clear indicators: business isn’t necessarily booming, but it’s much stronger with countries that have nearby neighbours. Europe, America and Asia are flooded with bordering nations! Relationships between these countries are very strong and it can make foreign spending much easier!

The U.S. are naturally miles clear given their infrastructure and advanced technology however there are multiple countries beginning to bridge the gap – and have been doing so for sometime.

More figures to come in 16 later in the year!

Foreign Direct Investment Figures 2013-15 Indicate Transition Economies Naturally Sit Well Below Developed Continents

Foreign Direct Investment Figures 2013-15 Indicate Transition Economies Naturally Sit Well Below Developed Continents

Figures from the United Nations Conference on Trade and Development (UNCTAD) have shown the progression of foreign investment across the 2013-2015 period. Segmenting the data into continents including Developing Asia; Europe; North America; Latin America and the Caribbean; Africa as well as Transition Economies, demonstrates a clear change and generally for the better.

The most noticeable trend is that of the transition economies. These economies have seen a dramatic decrease in FDI across the last 3 years. In terms of dollars, their 2013 output of $85 Billion became 56 in 2014 and 35 in 2015 signifying a decrease of 50 million in just 3 years. The ability to acquire assets and financial capital  in neighbouring countries is always going to be difficult for these nations as a result of a fragile economy.

The big surprise, however, is the growth seen in North America. America is notorious for being a world superpower in almost everything. But a decrease in foreign spending from 2013-14 of $118 Billion was incredibly concerning. Since that point, the continent has worked hard to improve their economic situation by spending a whopping $429 Billion in 2015 – a dramatic increase of $254 Billion! This type of spending leaves them third on the list understandably behind Developing Asia and Europe.

Similarly, Europe went from spending 323 and 306 Billion dollars to $504 Billion. This dramatic increase is a total of $198 Billion and indicates a strong growth for the continent as a whole – a positive outcome given their recent problems.

Clearly out on topic in the FDI spending are countries in Developing Asia. Incredibly, their 2013 foreign spending was higher than North America’s current personal best of $429 Billion. Asia has become on-par, if not more financially secure than the United States and this has come through their ability to invest overseas.

Africa’s spending has plateaued with minor ups and downs ultimately maintaining an FDI within $50-60 Billion. Clearly, their FDI policy hasn’t changed too much and given the data from the past decade it is unlikely to change much for the better.

So in comparison with other growing, stable economies well above them, countries in economic transition are potentially in need of some form of support.

The benefits of FDI in developing countries can be significant because it provides countries with resilience in trying circumstances. Many countries that have experienced economic recession in the last 20 years have protected themselves from complete disaster thanks to carefully strategised foreign direct investment.

The point may be obvious, but it is something we’ll be looking to analyse further!

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