World

Developing nations set to displace world's traditional economic leaders

by Pat Garcia | August 4, 2008 at 07:07 am

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Goldman Sacks' projections of current trends, world resources of energy, food and other inevitable surprises leads them to state that one of the "known unknown" factors that could make this possible is global climate change. According to their predictions Countries in the tropics and subtropics are likely to be hit drastically by climate changes first, while the countries now climbing rapidly in the high ranks will be hit harder at a later phase.

You have to hand it to the economics team at Goldman Sachs It was they who came up with the concept of the "BRICs:" the four big economies, in Brazil, Russia, India and China, that were going to catch up with and then overtake the big economies of the developed world.

More recently they added the "Next 11:" middle-sized developing countries like Turkey, Indonesia and Mexico that will also grow fast enough to overtake their old-rich counterparts in the next generation.

Back in 2006, Goldman Sachs predicted the Chinese economy would surpass that of the United States in the early 2040s, with the Indian economy not far behind. But now the Goldman Sachs team has put out a new set of forecasts.

The Chinese economy, they predict, will overtake the U.S. economy around 2025, not in the 2040s, and will be twice as big by 2050.

India's economy by 2050 will still be slightly smaller than that of the United States, but the economies of Brazil, Russia, Indonesia and Mexico will all be bigger than that of the next-largest old-rich country, Britain.