Projected Largest Economy in 2075: Emerging Markets Outpace Developed Nations

By 2075, research by Goldman Sachs projects emerging economies, particularly in Asia, will dominate the top five largest economies globally. While developed and emerging economies are forecasted to slow their growth rates, emerging markets are expected to outpace their developed counterparts. China, India, and Indonesia are anticipated to be the leading emerging economies, alongside the United States and Germany. The US, despite its depreciation, is expected to be the largest economy in the world due to the appreciation of the Dollar. However, appropriate policies in countries like Nigeria, Pakistan, and Egypt could potentially place them among the top largest economies by 2075.

According to a recent report by Goldman Sachs, emerging economies, particularly those in Asia, are poised to take over the top five largest economies globally by 2075 [1]. This projection comes as the global economy slows down due to weaker population growth and declining productivity [1].

Goldman Sachs predicts that the world's potential growth rate will average 2.8% per year between 2024 and 2029, gradually declining thereafter [1]. This is a significant decline from the average of 3.6% in the decade before the global financial crisis and 3.2% in the 10 years before the Covid pandemic [1]. The slowdown in economic expansion is attributed to a combination of factors, including a decline in population growth and weakening productivity [1].

Despite these challenges, emerging economies are expected to outpace their developed counterparts in growth [1]. China, India, and Indonesia are forecast to be the leading emerging economies, alongside the United States and Germany [1]. While the United States is expected to remain the largest economy due to the appreciation of the dollar, appropriate policies in countries like Nigeria, Pakistan, and Egypt could potentially place them among the top five [1].

Goldman Sachs projects that China will overtake the United States as the world's largest economy by around 2035, while India is expected to have the second-largest economy by 2075 [1]. These projections are based on current trends and assumptions about policy and economic conditions in these countries [1].

However, the report notes that a aging and shrinking population is a significant challenge that many countries will face in the coming decades [1]. This demographic shift will put pressure on governments to address rising healthcare and retirement costs [1].

References:

[1] Goldman Sachs. (2023). The Global Economy in 2075: Growth Slows as Asia Rises. Retrieved from https://www.goldmansachs.com/intelligence/pages/the-global-economy-in-2075-growth-slows-as-asia-rises.html

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