What is GDP Growth Rate?
GDP is a measure the economic output of a specified region within a specified period of time. The real GDP Growth Rate measures how fast the economy is growing. It does this by comparing one quarter of the country’s GDP to the previous quarter and adjusted for inflation. The GDP Growth Rate is commonly expressed as a percentage indicating the rate of change in a country’s GDP, typically on a yearly basis.
The GDP growth rate is a crucial indicator of economic health of a specified region within a specified period of time. This indicator is important to the following agents:
Government – in the implementation of fiscal policies, trade relations, import tariffs etc.
World Health Organisation – when making decisions regarding living standards and health
UNICEF – when making decisions regarding children’s wellbeing and access to resources
United Nations – when making decisions regarding deployment of Humanitarian Aid and resources.
Voters – economic growth, especially in poorer countries, allow voters to assess their future prospects with regard to jobs, health, housing, consumption, technology, education, living standards etc.
Employment Agencies – when making decisions regarding job creation
Central banks – during management of interest rates and money supply
G20 and other Nations – when making crucial decisions regarding investment, trade, import and export.
Foreign investors – when making crucial decisions regarding investment, manufacturing, trends in consumption and generation of profit.
Despite its huge importance, the GDP growth rate is given only in percentage. Unfortunately, this only a partial glimpse of countries actual GDP growth. This paper seeks to depict the incremental growth of countries, not in percentage, but in billions USD (GCB). It shows how many billions each top ten countries add to their economy each year. The numbers presented has an approximation margin of ±2 billion USD. The calculation is based on mean growth rate of the four quarters of 2018 (Jan- Dec 2018).
Growth Count in Billions (GCB) for each country of the Top Ten economies are as follow:
At the 10th position, Russia added 24 billion USD. It has the world’s largest natural gas reserves. It is also the largest exporter of gas and the second largest exporter of oil.
At the 9th position, Italy added an extra 24 billion USD to its economy in 2018. Italy is one of the world’s largest possessor of gold reserve, wealth and exporter of goods. It is the third largest economy of Eurozone. It is a large exporter of goods and its current account balance shows an annual trade surplus.
Next on the list is France at number 8, adding a total of 28 billion USD to its economy in 2018. France is the world’s top tourist destination. It has a competitive chemical industry and a substantial manufacturing base and it is also home to some of the largest companies in the world.
Brazil added 30 billion USD to its economy in 2018, which puts it at the number 7 on the list. Brazil’s natural resources include vast amount gold and iron. Its main export partner is China. Brazil is among the top five countries with the largest population.
At the 6th position on the list, Canada has effectively added a healthy 36 billion USD to its economy in 2018. Canada is the world’s second largest country in terms of geographical size. It is the fourth largest exporter of both petroleum and gas. Its highest import and export partner is the USA.
At the 5th position, United Kingdom has managed to add 42 billion USD to its economy in 2018, despite all the uncertainty around Brexit. The UK is one of the first industrialised country in the world. It continues to attract foreign investment and attention. London is the world’s largest financial centre. Moreover, the pound sterling is one of the most valued currency in the world.
Next on the list is Germany at number 4. This country has a huge GDP output, which implies that even if it grows under 2 percent in a year, it still manages to add a huge amount to its economy. Canada has successfully added a 50 billion USD to its economy in 2018.
The 3th position is occupied by India, which added a noteworthy 213 billion USD to its economy in 2018. India is the fastest growing large economy in the world. Although relatively poor compared to developed nation, India’s economy is powering ahead at fast pace in all sectors including real estates, It & software, manufacturing, solar, agriculture, drugs & chemicals, infrastructure, insurance, banking, transport, roads education, healthcare etc. All of these have attracted a lot of investment from foreign players.
In 2nd position, the USA’s has added a massive 617 billion USD to its economy in 2018. It is the world largest consumer market (14 trillion USD). It is the world’s largest trading nation, with the largest industrial sector. The US dollars is the world’s most important currency. It is also the country that attracts the most foreign investment on the world.
At number 1, China added a staggering 926 billion USD to its economy in 2018. It is the world’s largest manufacturer and exporter of goods, with a foreign-exchange reserve of 3 trillion USD. In the early 2000, China was adding in excess of 200 billion USD to its economy every year. Through incremental GDP growth, it has reached a point where it is now adding nearly a trillion USD. This has allowed China to get hundreds of millions of people from abject poverty within only two decades.
The chart below shosw a summary of the Growth Count in Billions (GCB) for each country of the Top Ten economies:
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Useful Resources
https://www.imf.org/external/datamapper/NGDP_RPCH@WEO/OEMDC/ADVEC/WEOWORLD
http://statisticstimes.com/economy/countries-by-gdp-growth.phphttps://www.indexmundi.com/g/r.aspx?t=0&v=66
https://www.gfmag.com/global-data/economic-data/countries-highest-gdp-growth-2017
https://knoema.com/atlas/maps/Real-GDP-growth
https://en.wikipedia.org/wiki/List_of_countries_by_real_GDP_growth_rate
https://www.worldatlas.com/articles/20-countries-with-the-highest-gdp-growth-in-the-world.html
https://www.investopedia.com/ask/answers/what-is-gdp-why-its-important-to-economists-investors/
https://www.abc.net.au/news/2016-06-01/gdp-growth-figures-what-are-they-all-about/7466186
https://www.forbes.com/sites/greatspeculations/2017/06/09/the-importance-of-economic-growth-and-the-consequences-of-its-demise/
https://marketrealist.com/2015/07/economic-growth-importanthttps://www.bankofengland.co.uk/knowledgebank/why-does-economic-growth-matter
http://www.un.org/en/sections/what-we-do/
https://www.telegraph.co.uk/finance/economics/11159277/What-does-GDP-really-tell-us-about-economic-growth.html