PricewaterhouseCoopers report "The World in 2050" takes a fresh look at how big the emerging market economies will get. It provides a report of how the OECD countries can compete. The major shift in economic power to emerging countries such as China and India should be grasped by those in established economies as an opening to enhance trade rather than feared as an economic death knell.
By the year 2050, the report predicts the "E7" economies to outstrip the "G7" economies. The countries belonging to the E7 economies include China, India, Brazil, Russia, Indonesia, Mexico and Turkey. The current "G7" economies include US, Japan, Germany, UK, France, Italy, and Canada. The "E7" economies will outstrip the "G7" by between 25% when comparing GDP using market exchange rates to around 75% when using purchasing power parity (PPP) exchange rates.
This will surely generate key new market opportunities, allowing companies in the established OECD economies to focus in areas of relative advantage, while their consumers benefit from low cost imports from the emerging economies-a 'win-win' outcome rather than 'one winner takes all'. The report's author, UK firm Head of Macroeconomics John Hawksworth, reveals some potentially astonishing conclusions. For example, projections suggest that India has the potential to be the fastest-growing large economy in the world as we approach the mid-century, followed by Indonesia-both ahead of China, due in particular to their less rapidly ageing populations. Through this report, PricewaterhouseCoopers shows the minute details and the meticulous knowledge shared by Big Four firms in anticipating the new challenges and profitable pockets of the world.
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