The International Monetary Fund (IMF) releases a study twice yearly titled “World Economic Outlook” (WEO) that analyses the growth, GDP, CPI, unemployment rates, surpluses, and deficits of various countries. When it comes to gathering information, the IMF relies on its consultants who work with the country’s official institutions to ensure accuracy. The ranking of countries based on their economy is included in less thorough studies produced in July and January.
There are about 190 countries that are members of the IMF, and this study focuses on how those countries have developed and how they have communicated internal and external challenges to the rest of the globe based on their statistics. It also predicts its expansion into other markets around the world.
What is world GDP ?
The global GDP is the sum of each GDP by country. Adding the value of a country’s imports to its GDP and subtracting its export earnings gives us the country’s net national income. Differences between GDP and GNI can be attributed to GNI’s inclusion of the effects of both local and international commerce.
When the total global gross national product (GNP) is considered, the value of imports and exports is equal. The United States economy largest economies in the world of 193 economies.
The World Bank predicts that the nominal GDP in 2017 was $80,683.79 billion. The nominal gross domestic product of the globe was $84,835.46 billion in 2018, and $88,081.13 billion is expected for 2019. The global GDP grew at a pace of 3.6% in 2018.
Nominal GDP vs. PPP GDP
When doing international GDP comparisons, it is necessary to adjust for currency fluctuations. Nominal and PPP systems are the two most widely used methods of converting between different currencies. Both of these methods for calculating GDP have their advantages, but they are typically employed for distinct purposes.
Whether comparing economies on a national, regional, or global scale, nominal GDP is a valuable metric to utilize. Modern market prices are used to calculate the region’s nominal real GDP per capita, which then adjusts for inflation. Nominal GDP can reveal price increases in an economy because it factors inflation into the GDP calculation. The nominal gross domestic product takes inflation into account as well.
The biggest problem with nominal GDP is that it ignores citizens’ level of living in favor of analyzing economic development and output. Changes in the value of the currency can also have a major impact on the annual growth rate of nominal GDP.
The term “PPP” refers to the “purchasing power parity” between two currencies. PPP GDP is valuable for international comparisons since it measures both world’s largest economies growth and living standards. Currency conversions are made using exchange rates in the PPP method. Then, the purchasing power of each currency is measured against another using the same unit of currency. PPP uses things like the price of a car in France GDP per capita and Japan gross domestic product to figure out how much of a difference states by GDP and living costs. PPP GDP growth or drop from one year to the next is rather insensitive to fluctuations in the exchange rate.
One criticism of PPP GDP is that it ignores regional differences in the quality of products and services. It relies more on guesses than on actual computations, making it less precise than nominal GDP. Hence, the nominal GDP is the standard for making cross-national comparisons of economic output.
List of countries Ranked by GDP for 2023
Gross domestic product is a statistical measure of a country’s economic activity. The standard of living in a country improves in tandem with its economic growth and GDP.
The United States, China, and Japan are the world’s three largest economies in the world based on nominal GDP. Investment in workforce education, production output (as measured by investment in physical capital), natural resources, and entrepreneurialism are all important contributors to economic growth and prosperity. As will be seen below, the United States, China, and Japan each have their own distinct mix of these elements that have contributed to economic growth over time.
1. United States
The US GDP per capita has the world’s largest economy, growing at a nominal pace of 5.7% to a nominal GDP of $23.00 trillion. The sectors of the economy most responsible for the expansion of the United States Gross Domestic Production per capita are those dealing with healthcare, real estate, insurance, finance, information technology, and professional services.
Businesses and FDI are encouraged to put more money into the country because of the favorable economic climate. The United States may have the largest economy in the world and strongest country in the world, but its citizens nevertheless confront challenges such as rising healthcare costs, deteriorating infrastructure, income disparity, changing weather patterns, and insecure communities.
China GDP 2023 has the second-biggest economies in the world, expanding at an annual rate of 8.1% on a nominal GDP of $17.73 trillion. According to the Purchasing Power Parity (PPP) method of calculating GDP, this country has the greatest economy in the world. China’s economy and industrial capacity have been expanding at a rapid clip in recent years.
Domestic manufacturing policy in China’s GDP per capita leads to increased output and lower unit costs. As a result, China has become the world’s largest exporter which have a big role in China Gross Domestic Production growth, driving most of the country’s growth and prosperity. The Chinese government has outlawed any app that is created in a country other than China. Health problems, an aging population, and environmental concerns are also major problems in China.
Japan’s GDP is third globally and is growing at a rate of 1.6%, with a nominal GDP of $4.94 trillion. The Japan GDP per capita has made significant improvements to its government and industry policies since the devastating recession of 1990. Keiretsu is a business model used throughout GDP of japan per capita (A business network made up of different Japanese companies).
The Japanese economy benefits greatly from the country’s innovative business culture and its numerous manufacturing and production firms. The Japanese are forced to import energy due to their country’s dwindling natural resources and rapidly aging population.
With a nominal GDP of $4.22 trillion and a Germany GDP growth rate of 2.9%, Germany GDP per capita economy is the fourth largest in the world. It has the most advanced form of social capitalism and is the largest economy in Europe.
Production of machinery, chemicals, and motor vehicles is booming thanks in large part to the efforts of the country’s highly skilled labor force. There are serious problems with the social welfare system, the aging population, and the rising infertility rates in Germany.
5. United Kingdom
The United Kingdom’s economy is the fifth richest country in the world, with a nominal GDP of $3.19 trillion and a GDP growth rate of 7.4 percent. Northern Ireland, England, Wales, and Scotland are the four constituent nations that make up the United Kingdom.
Most of the country’s UK Gross Domestic Production per capita is produced by the financial sector, the insurance industry, and other commercial services. There is a growing concern about the state of people’s health in the United Kingdom.
With a nominal GDP of $3.17 trillion and a GDP growth rate of 8.9%, India’s economy is the sixth largest in the world. Nonetheless, because of its massive population, India has the world’s lowest per capita GDP.
India GDP per capita has benefited greatly from its many thriving industries, including traditional and modern agriculture, the handicraft industry, technological services, and business outsourcing. Intractable corporate practices, poverty, corruption, and resistance to modernization are among India’s most pressing problems.
With a nominal GDP of $2.94 trillion and a GDP growth rate of 7.0%, France’s economy is the seventh largest in the world. In France’s economy, both the government and private businesses play significant roles.
France’s economy relies heavily on the tourism industry. Many French citizens are stressed out because of the country’s mounting public debt, high unemployment rate, and competitive labor market.
With a nominal Italy GDP of $2.10 trillion and a GDP growth rate of 6.6%, Italy’s economy is the ninth largest in the world. Businesses and services are the mainstays on which Italy’s economic framework rests.
Gross Domestic Production for Italy’s economic growth is mostly attributable to the fashion, food, and auto parts industries. There is a lot of chaos in the government, a lot of people out of work, a lot of debt, and a shaky banking system that the people there have to deal with every day.
In terms of nominal GDP, Canada is ninth in the world, and its economy is growing at a rate of 4.6%. Although the United States and Canada have a free trade agreement, their relationship is still very close.
Moreover, Canada boasts the world’s third-largest oil reserves. The energy extraction industry has matured to the point that it is the single most important driver of Canada GDP per capita development. The main crisis in Canada is climate change, followed by violence against women, counter-terrorism, and the lack of accountability in the corporate sector.
10. South Korea
With a nominal GDP of $1.80 trillion and a GDP growth rate of 4.0%, it is the world’s tenth-largest economy. South Korea GDP per capita has earned its status as an export powerhouse thanks to the country’s chaebol system (similar to a monopoly market) and export-focused policies.
Telecommunications components, automobiles, and electronics are all crucial to the expansion of South Korea Gross Domestic Production. The main problems that South Korea is facing are the aging of the workforce and the weak development rate.
With a nominal Russia GDP of $1.78 trillion and a GDP growth rate of 4.8%, Russia’s economy ranks twelfth in the world. Russia GDP per capita has adopted a free-market capitalist system (where prices of goods and services are freely decided upon the demand and supply of goods and services, respectively).
The rise of the GDP of Russia is mostly attributable to the export of oil, gas, minerals, and metals. Because of the war with Ukraine, the country is in a dire situation. Economic sanctions and fines have been imposed on the country.
It is the world’s tenth-largest economy, GDP in Brazil growing at a rate of 4.6%, with a nominal GDP of $1.61 trillion. The Brazilian government enacted more economic reforms in 2018 as a direct result of the devastating impact the recession of 2017 had on the Brazil GDP.
GDP for Brazil relies heavily on the mining and processing of commodities like oil and natural gas, the assembly of consumer goods like cars and aero planes, and the export of basic commodities like coffee and soy beans. Major sources of unrest in Brazil GDP per capita revolve around concerns about democracy, women’s rights, police behavior, and public safety.
Australia Gross Domestic Production is the world’s thirteenth largest economy, growing at a rate of 1.5% and with a nominal GDP of $1.54 trillion. Australia’s domestic economy is seen as free and open, and it has trade agreements with countries all over the globe.
The country’s economy has been booming thanks to its exports of agricultural goods and its abundant natural resources. Legal protections for the GLBT community, the right to free speech, and the rights of people with disabilities are all pressing societal concerns in Australia.
With a nominal GDP of $1.28 trillion and a Gross Domestic Production growth rate of 5.1%, GDP Spanish ranks as the fourteenth largest in the world. After experiencing severe economic hardship during the Great Depression, Spain opened its doors to foreign investment and expanded its exports.
The expansion of the economy may be traced primarily to two factors: the production of machinery and the export of food products. People in Spain are concerned mostly with the government’s instability.
With a nominal GDP of $1.29 trillion and a Gross Domestic Production growth rate of 4.8%, Mexico’s economy ranks as the fifteenth largest in the world. Manufacturing in Mexico has advanced greatly during the past three decades.
Automobiles, consumer electronics, agriculture, petroleum, and auto parts export all play important roles in the national economy. The Mexican public faces a huge threat from the country’s persistent international drug trade.
With a nominal GDP of $1.19 trillion and GDP growth of 3.7%, Indonesia has the world’s sixteenth-largest economy. When it comes to economies in Southeast Asia, this one is by far the biggest.
Exports of oil, food, and coal account for the bulk of Indonesia’s GDP. Corruption in the administration and a lack of basic infrastructure have contributed to a humanitarian disaster in Indonesia.
The economy of the Netherlands, which has a nominal GDP of $1.03 trillion and a GDP growth rate of 5.0%, is the seventeenth largest in the world. It is also widely acknowledged as the world’s premier center for commercial transportation.
The country’s robust economic expansion may be attributed mostly to two factors: its big finance industry and its agricultural exports. Most Dutch citizens are concerned about rising living costs and the effects of climate change.
18. Saudi Arabia
With a nominal GDP of $833.5 billion and a GDP growth rate of 3.2%, Saudi Arabia’s economy ranks as the world’s eighteenth largest. In addition to being a major player in the global oil market, this nation is also a major exporter of oil.
The country’s economy has grown solely due to oil exports. Several environmental and religious problems plague Saudi Arabians.
With a nominal GDP of $815.27 billion and a GDP growth rate of 11.0%, Turkey’s economy is the nineteenth largest in the world. This country is widely viewed as having an open economy due to its sizable service and manufacturing sectors.
Industries such as petrochemicals, automobile manufacturing, and electronics have played crucial roles in the country’s economic expansion. Discrimination and violence are the country’s two most pressing societal problems.
With a nominal GDP of $812.90 billion and a Gross Domestic Production growth rate of 3.7%, Switzerland has the world’s twenty-first largest economy. The Swiss labor market is also well-known for its exceptional level of expertise.
The rise of the economy may largely be attributed to the financial services industry and the high-tech industrial sector. Increases in healthcare costs, environmental changes and unemployment are among the country’s most pressing social challenges.
Forecast for GDP Growth in 2023
It is predicted that global GDP will expand by just 2.9% in 2023, down from 3.2% in 2022.
In part because of China’s reopening, increased global demand, and slower inflation expected across certain countries in the year ahead, this is an increase of 0.2% from the October 2022 Forecast.
Given the many economic challenges that will be present in 2023, the highest GDP per capita growth projections for 191 jurisdictions.
In 2023, GDP growth in the United States is expected to reach 1.4%, up from the 1.0% predicted in October.
A white-collar or “Patagonia-vest” recession has been predicted, and the swelling wave of tech layoffs is one indicator of this trend. With the trend continuing into 2023, 88,000 IT jobs were lost last year. The world’s largest financial institutions have joined them. In spite of this, as of December 2022, the unemployment rate is still a manageable 3.5%. Even if inflation and interest rate hikes appear to be easing, they nevertheless pose significant long-term problems.
The consensus estimate for European GDP growth in 2023 is 0.7%, down significantly from the 2.1% predicted in 2018.
Growth is anticipated to be modest in both Germany (0.1%) and Italy (0.6%). Since the IMF’s previous report in October, growth projections have been revised upwards. The manufacturing sector is particularly vulnerable due to the prolonged energy crisis, which might have knock-on repercussions for other sectors and the Euro Area economy as a whole.
The situation in China is unclear at this time. The growth forecast for 2023 is 5.2%, which is greater than the growth forecasts of several major economies. While there have been symptoms of deterioration in the real estate sector, the recent opening on January 8th after 1,016 days of zero-Covid policy has the potential to increase demand and economic activity.
Many Steps Yet to Take
A global recession is expected to hit in 2023, according to the International Monetary Fund. It is unclear, however, whether it will see a resurgence or continue its precipitous decline.
Presently, the highest Gross Domestic Production of countries are being supported by two factors: private sector balance sheets that are strong and energy costs that are lower than predicted. Natural gas prices in Europe have dropped to levels not seen since before the conflict in Ukraine. Companies were remarkably resilient during the peak of the energy shocks when skyrocketing energy prices severely impacted their bottom lines. They have plenty of cash on hand, too.
Yet, inflation is not over by any means. Several governments’ central banks will need to implement price-control measures to counteract this effect. This could have unintended repercussions for economic development and the financial markets.
There may be a disconnect between consumer attitudes and whether or not things are actually moving in the economy as economic data continues to be presented throughout the year. Nobody knows what the Gross Domestic Production of countries will be like in 2023.