Dubai — The Middle East and Africa region is expected to maintain the highest real GDP growth rate in the world for more than two decades, leaving behind the Asia-Pacific, the Americas and Europe in the race to economic development, the Economist Intelligence Unit, or EIU, projected in its recent long-term forecast entitled “Key trends to 2050”.
During the 2020-to-2030 period, the MEA is expected to record nearly four per cent real GDP growth, compared to the Asia-Pacific at around three per cent; Americas’ 2.5 per cent; and Europe’s 1.6 per cent in the same decade. The MEA will continue to maintain its top position during the 2031 to 2040 period with nearly 2.8 per cent growth followed by Asia-Pacific at 2.6 per cent; Americas’ two per cent; and Europe’s 1.4 per cent.
The last decade (2041 to 2050) of the forecast projected that the Asia-Pacific will overtake the Middle East with slightly have better GDP growth, but both the regions remain between two per cent and 2.5 per cent. Asian economies will account for more than half of the global economy by 2050, according to a long-term forecast by the London-based EIU. At present, Asia contributes to about one-third of the global economy, it added.
Other studies by the Asia Development Bank, PricewaterhouseCoopers and HSBC Global Research also predict a shift in global economic power to Asia by 2050. China, now the biggest Asian economy, will emerge the world’s richest by 2050 with nominal GDP seen to reach $105.92 trillion, according to the EIU.
China is expected to overtake the US in 2026 in nominal GDP in US dollar terms and maintain its position as the largest economy to 2050. India is expected to move up the rankings to third place, with real growth averaging close to five per cent up to 2050.
Indonesia and Mexico are expected to leap into the top 10 world economies from 16th and 15th place in 2014 to fourth and eighth place, respectively, by 2050.
“We do not expect the representation of Western economies within the top-ten listing to become insignificant. The US, Germany, the UK and France will all move down the rankings, but only Italy will lose its place within the top ten,” the EIU said.
The rise of Asia is not a new phenomenon; the rise of Japan and South Korea has been witnessed over the second half of the 20th century. The start of the new millennium saw another boom, with many Asian economies recording high growth rates that took their share of global GDP from 26 per cent to 32 per cent between 2000 and 2014.
By 2030 the top three economies of the world will be the US, China and India. Such will be the growth of the two latter countries, in particular, that by 2050 they will each be richer than the next five (Indonesia, Germany, Japan, Brazil, and the UK) put together. This will represent a scale of wealth relative to the rest of the top 10 that is unique in recorded history.
Given China’s and India’s economic might, they will take on a much bigger role in addressing global issues such as climate change, international security and global economic governance.
In the medium term, this will require the world’s existing powers—notably the US — to let India, and especially China, play a greater role on the world stage and adapt international institutions to allow them to exert greater influence.
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