The Current Global Position
Posted on: 09 Oct, 2021
In most parts of the world, in the context of long-term economic growth, the GDP of various countries will fluctuate with the stages of different economic cycles. However, it is interesting to note that despite these ups and downs, the major economies as measured by GDP did not easily change positions. Compared to the top 25 economies in 2000, our research found that among the top 25 economies, only Thailand, Indonesia and Nigeria had never appeared before. In other words, there are a few big movers on the list. China and India reached second and fifth place respectively, and placed sixth and 13th in 2000. Below the list, Indonesia, one of the three newcomers mentioned above, rose from the 27th economy in 2000 to 16th in 2019, while Nigeria has moved from 46th to 25th.
While 2019 is the most recent annual data available for these countries, the COVID-19 pandemic has had a major impact on economies across the world. Because it has slashed energy prices, cratered tourism, lowered trade volumes, and shuttered stores due to quarantines, countries have seen record-breaking declines in GDP. While many economies have begun to recover in the third quarter of 2020, most have not yet recovered to pre-pandemic GDP levels. China is a notable exception, and it's currently on track to be the only major economy to end 2020 with a larger GDP than it started with.
This article mentions several popular ways to measure GDP, all of which are drawn from the World Bank database: Nominal GDP in Current U.S. Dollars: This is the most basic and common way of measuring and comparing GDP among countries, using local prices and currencies converted into U.S. dollars using currency market exchange rates.
This is the number that was used to determine the countries' rankings in the top 25 list. Purchasing Power Parity (PPP) Adjusted GDP in Current International Dollars: This is an alternative way of comparing nominal GDP among countries, adjusting currencies based on what basket of goods they could buy in those countries rather than currency exchange rates. This is a way to adjust for the difference in the cost of living between different countries.
GDP Growth: This is the annual percent growth rate of nominal GDP in local prices and currencies, which estimates how fast a country’s economy is growing.5
GDP Per Capita, in Current U.S. Dollars: This is nominal GDP divided by the number of people in a country. GDP per capita measures how much a country’s economy produces per person, rather than in total. This can also act as a very rough measure of income or standard of living for individuals living in a country.6
Throughout this list and article, the term GDP refers to nominal GDP in current U.S. dollars unless otherwise specified.