Wednesday, 20 September, 2017

Iran to become world’s 17th largest economy by 2050

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Iran could become the 17th largest economy in the world by 2050 based on its gross domestic product (GDP) at purchasing power parity (PPP), PricewaterhouseCoopers (PwC), one of world’s biggest management consultancy firms, said in a report.

According to the report titled, ‘The Long View: How will the global economic order change by 2050?’, Iran ranked at 18 in 2016 and its GDP-PPP was close to $1452 billion. By 2030, the GDP-PPP will reach $2,354 billion.

By 2050, the GDP-PPP is expected to exceed $3,900 billion, the report stated.

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The professional services firm in its report said that Pakistan’s yearly GDP growth till 2050 would average 2.9 percent and per capita growth is expected to be at 2.5 percent.

The global economy also will be dominated by China by 2050, and the US economy will lose steam and fall behind India.

PwC concluded that by 2050, China’s GDP would reach $58.5 trillion, India, over $44 trillion, while the US will have a $34.1 trillion economy.

Japan, which was the fourth largest economy in the world as of 2016, will drop to the eighth place, while Germany will slide from the fifth to the ninth position. Russia will remain on the sixth place, but Russia will remain Europe’s first economy, after Germany slides on the ranking, the report says.

Given a robust annual growth of four to five percent, Vietnam, the Philippines and Nigeria are predicted to make the greatest move up the GDP rankings.

The consulting firm also predicted 2050 GDP numbers based on market exchange ratings, an alternative method for GDP calculation. In these rankings, the US will lose global dominance by 2030, and the gap will only grow by 2050 with China having a nearly $50 trillion GDP, and the US having the same $34.1 trillion.

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Key findings of the report projected that the world economy could more than double in size by 2050. Assuming broadly growth-friendly policies, emerging markets would continue to be the growth engine of the global economy.

Purchasing Power Parity (PPP) is an economic theory that compares different countries’ currencies through a market “basket of goods” approach. PPP determines the economic productivity and standards of living of various countries over a period. Since market exchange rates fluctuate substantially, many economists consider PPP as a more precise way of estimating a country’s economy.

RT contributed to this report

 

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