Top 10 GDP Countries 2021
GDP (Gross Domestic Product), the total market value of all the goods and services a country generates in a given year, is a measure of the health of its economy. Real GDP has a role in the economic rankings of nations. A nation's currency rate fluctuations can also produce a range of outcomes. In terms of both systems' rankings of GDP as of 2021, the United States and China are the top two countries. The nominal difference between the US and China is decreasing as China's GDP growth rate for 2021 (8.02%) is higher than the US's 5.97%. In 2021, the US will be $6 trillion ahead of China. China surpassed the US in 2017 and is now $4 trillion ahead of it on a per-person basis, and the gap is widening. Over the coming decades, China's economy will continue to grow faster than the US's and India's, leaving them in second and third place, respectively, on a per-capita basis.
The top 10 places on the nominal GDP list would be the same. Other alterations to the top 20 include Iran passing the Netherlands, Saudi Arabia passing Turkey, and Switzerland. South Africa would rise eight ranks in the top 50 in the economic rankings, while Egypt would fall four spots. The market value of a country's finished products and services in a given year is also known as its gross domestic product (GDP).
Nominal GDP does not account for variations in the cost of living among nations, and the statistics might shift significantly from year to year based on changes in exchange rates. To account for variations in the cost of living in various nations, comparisons of national wealth are typically performed based on purchasing power parity (PPP). For comparison of country standards of living, other measures such as nominal GDP per capita and comparable GDP (PPP) per capita are used.
The output of the United States surpassed that of the British Empire in 1916, which in turn had overtaken the Qing dynasty in total, as the rankings of national economies have shifted significantly over time. China's ranking has risen from ninth in 1978 to second in 2010 since it transitioned to a market-based economy through controlled privatisation and deregulation. Since the advent of economic liberalisation in the early 1990s, India has also enjoyed an economic boom among other countries.
The World Economic Outlook of the International Monetary Fund is represented in the first list, the World Bank is represented in the second list, and the United Nations Statistics Division is represented in the third list. Every April and October, the IMF releases its forecasts for the upcoming year and its conclusive data for the previous year. The list includes non-sovereign entities (the planet, continents, and some dependent territories) and nations with a patchwork of international recognition (Kosovo, Taiwan, etc.).
GDP can be computed using expenditures, production, or incomes and aids in giving a quick overview of a nation's economic health.
The sum of the gross national incomes for all nations worldwide is the world GDP. GNI, or gross national income, is different from GDP because it considers the effects of domestic and foreign commerce. The value of money from imports is added to a nation's GDP, and the value from exports is subtracted. The value of imports and exports is equal when the combined GNIs of all nations are taken into account. There are one hundred and ninety-three economies in the world, with the United States being the biggest.
According to World Bank projections, the nominal global GDP totalled $80,683.79 billion in 2017. In 2018, the global GDP grew at a 3.6% annual rate. The nominal world GDP for 2019 is $88,081.13 billion, up from $84,835.46 billion in 2018.
PPP GDP vs Nominal GDP
It is necessary to convert currencies to ensure consistency across all nations when comparing GDPs. Nominal and PPP are the two main methods used to convert between common currencies. These two methods of estimating the GDP each have unique advantages and are typically employed for various purposes. Nominal GDP is helpful for large-scale GDP comparisons, whether on an international or regional level. Using current market values, the nominal GDP of a region is calculated and fluctuates in line with inflation. Nominal GDP can show when prices grow in an economy by factoring in an area's inflation rate while calculating GDP. Nominal GDP also takes into account when an economy's rate of price increases.
Nominal GDP's primary drawback is that it solely considers economic growth and performance, not a nation's living level. Additionally, depending on changes in the currency rate, nominal GDP can often vary dramatically from year to year. Purchasing power parity is referred to as PPP. PPP GDP is a helpful tool for cross-national comparisons since we can use it to gauge both economic growth and living standards in a nation. The PPP method converts money from one nation into another using exchange rates. The quantity of goods and services acquired in the two countries is then compared using a fixed amount of money. PPP might, for instance, compare the price of a car in France to the price of a car in Japan (after converting yen to Euros or vice versa using the exchange rate) to examine the differences in GDP and cost of living in these countries.
PPP GDP has also the drawback of not accounting for differences in the calibre of products and services in various nations. It generally relies more on estimations than computations and is less precise than nominal GDP. As a result, the nominal GDP is frequently used to gauge and contrast the size of different countries' economies.
The World's Largest Economies
The United States, China, and Japan have the three biggest economies in the world compared to nominal GDP. Numerous factors, including investments as measured by investments in physical capital impact economic growth and prosperity. These elements have contributed to economic growth in the US, China, and Japan economies over time.
Rankings of GDP by Country
Which countries have the world's biggest economies? These nations have the greatest nominal GDPs worldwide, according to the International Monetary Fund:
1. The United States
Additionally, the US GDP (PPP) is $21.44 trillion. The projected worth of the nation's natural resources in 2016 was $45 trillion. The robust economy of the United States is a result of numerous causes. The United States is renowned worldwide for fostering a culture that values and supports entrepreneurship, fosters innovation and promotes economic progress. The workforce has become more diverse due to the rising population in the US. The United States is second only to China among developed nations in manufacturing. Additionally, the most common currency for international trade is the US dollar.
With a nominal GDP of $14.14 trillion and a GDP (PPP) of $27.31 trillion, China has the second-largest economy worldwide. Ninety percent of China's natural resources, which total $23 trillion, are coal and rare earth metals. Worker effectiveness is another factor fuelling for China's economy's expansion. The nineteen hundred and seventy-eight economic reform programme in China was very successful, and as a result, average economic growth increased from 6% to over 9%. The reform programme strongly emphasised establishing rural and private companies, relaxing state pricing controls, and investments in industrial output and workforce education.
With a $5.15 trillion GDP, Japan has the third-largest economy in the world. The PPP GDP of Japan is $5.75 trillion. It was anticipated that the 2020 Olympics would stimulate the Japanese economy, which had lagged since the financial crisis of 2008 and had taken damage. The Japanese economy will likely confront some significant obstacles in the future, including a dwindling population and a debt that, as of 2017, was 23.6% of its GDP.
Germany ranks 18th in the world per capita GDP and fourth in GDP, with a $4.44 trillion GDP (PPP) per capita GDP of $46,560. Europe's largest and most powerful economy, with one of the most highly skilled labour groups, is Germany's highly developed social market economy. The International Monetary Fund estimates that Germany contributed 28% to the Europe area's economy.
The main industries in Germany are the production of automobiles, machinery, home furnishings, and chemicals. Due to the Internet and the digital age, the German economy is currently in the midst of its fourth industrial revolution. This change is called "industry 4.0," which encompasses solutions, processes, and technologies and describes IT and extensive system networking in manufacturing.
5. The United Kingdom
By 2023, the UK's $3.27 trillion GDP is predicted to make it the seventh-largest economy in the world. The UK was the tenth-largest merchandise exporter in 2016, with exports to 160 different nations. The second and third-largest sectors in the United Kingdom are manufacturing and agriculture. Britain has the second-largest aircraft sector and the tenth-largest pharmaceutical sector in the world, respectively.
With a GDP (PPP) of $2.96 trillion and a GDP per capita of $42,877.56, France has the 6th highest GDP in the world. The World Bank reports that France has recently had high unemployment rates. In 2014, 2015, and 2016, the jobless rate was 10% and it fell to 9.681% in 2017. The economy of France is diversified and focused on free markets. Crucial industry for France is the chemical industry, agriculture, and tourism. About one-third of the EU's total agricultural land belongs to France, the second-largest agricultural exporter and the sixth-largest producer behind the United States in the global rankings.
India's GDP (PPP) is $10.51 trillion, more than Japan's and Germany's combined GDP. India has a large population, which results in a $2,170 GDP per capita compared to the US (the United States has a GDP per capita of $62,794). India is transitioning from its past autarkic policies to an open-market economy. Early in the 1990s, India started to liberalise its economy, which included privatising state-owned companies, reducing restrictions on foreign investment and trade, and defragmenting the industrial sector. These actions have sped up India's economic expansion. India's service industry, which accounts for 60% of the nation's GDP and 28% of employment, is the fastest-growing sector in the whole globe. Agriculture and manufacturing are two other important economic sectors.
Italy's economy is valued at $2.40 trillion in terms of GDP (PPP), or $34,260.34 per person. Its nominal GDP of $1.99 trillion places Italy's economy eighth in the world. By 2023, it is projected that Italy's economy will reach $2.26 trillion. Unfortunately, Italy has a debt level of 132% of GDP and a rather high unemployment rate of 9.7%.
Fortunately, Italy's exports are supporting the economy's resurgence. With other members of the European Union accounting for 59% of its commerce, Italy is the eighth-largest exporter in the world. Italy used to have a predominantly agricultural economy before World War II, but it is today one of the most developed countries in the world. Italy, the second-largest exporter in the EU after Germany, enjoys a sizable trade surplus due to its food, clothing, machinery, vehicles, luxury items, and more exports.
The largest and most populated country in Latin America is Brazil. With a per capita GDP of $8,967 and a GDP (PPP) of $2.40 trillion, Brazil ranks 73rd in the world. Natural resources worth an estimated $21.8 trillion are found in the nation, including enormous amounts of gold, iron, uranium, and forest. Brazilian free markets are still in their infancy. Brazil's economy became one of the quickest among the world's major economies between 2000 and 2012. But one of the unequal economies in the world is Brazil's. More than 100 million of Brazil's poorest citizens are poorer than six of the country's billionaires combined. In 2017, homeless people grew due to the economic crisis, corruption, and lack of public policy.
The nominal GDP of Canada's economy, which is $1.73 trillion, ranks it as the tenth largest in the world. While Canada's GDP (PPP) of $1.84 trillion is rated 17th globally, its per capita GDP of $46,260.71 is ranked 20th globally. By 2023, it is anticipated that Canada's GDP will reach $2.13 trillion. With a $33.2 trillion projected value, Canada ranks fourth in terms of natural resource wealth. Due to its abundance of natural resources like oil and gas, Canada is seen as a superpower in the energy sector.