For the first time, the combined GDP of poor nations is greater than the rich ones

August 29, 2013 Leave a comment

For the first time, the combined GDP of poor nations is greater than the rich ones

By David Yanofsky @YAN0 August 28, 2013

For the first time ever, the combined gross domestic product of emerging and developing markets, adjusted for purchasing price parity, has eclipsed the combined measure of advanced economies. Purchasing price parity—or PPP for short—adjusts for the relative cost of comparable goods in different economic markets. According to the International Monetary Fund—the supplier of this data—emerging and developing economies will have a purchasing price parity-adjusted GDP of $42.8 trillion in 2013, while that of emerging economies will be $44.4 trillion. In other words, emerging markets will create $1.6 trillion more value in goods and services than advanced markets this year. Advanced economies are, according to the IMF, the 34 nations that result from combining the members of the G7, euro area countries, and the 4 “newly industrialized Asian economies”—Taiwan, Hong Kong, Singapore, and South Korea. The world’s 150 other nations are considered emerging or developing. Excluding the largest advanced economy, the United Sates, and the largest emerging economy, China, which both account from more than 30% of their respective group’s total GDP, the data show that the PPP-adjusted GDP of poorer nations surpassed that of richer ones in 2009. It’s worth keeping in mind that the emerging economies have strength in numbers. Not only are there more emerging and developing nations; those nations also boast a larger combined population. As such, emerging and developing economies trail far behind advanced economies in per-capita terms. Their aggregate per-capita PPP-adjusted GDP is $7,415, while the same measure for advanced nations totals $41,369.

purchasing-power-adjusted-gdp-advanced-economies-emerging-market-and-developing-economies_chartbuilder purchasing-power-adjusted-gdp-advanced-economies-excluding-us-emerging-economies-excluding-china_chartbuilder gdp-ppp-per-capita-advanced-economies-emerging-market-and-developing-economies_chartbuilder-2

Filed under Macro Trends

Unknown's avatarAbout bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

Leave a comment