Friday, 13 January 2012

PH to become 16th largest economy by 2050

by Roderick T. dela Cruz
Manila Standard

The Philippines will be one of the fastest-growing economies over the next four decades, with its gross domestic product predicted to be the 16th largest in the world by 2050.

Hongkong and Shanghai Banking Corp. Global Research, in a report titled the World in 2050, said the Philippines looks set for a multi-decade run of strong growth to become the world’s 16th largest economy, up 27 places from today and ahead of all other Southeast Asian countries and even rich economies in Europe.

“Asia is the stand-out region—with a notable showing by the Philippines,” the HSBC report said. “The Philippines looks set for a multi-decade run of strong growth.”

From its 2010 status as the world’s 43rd largest economy with a GDP of $112 billion, the Philippines is projected to increase the size of its economy to $1.688 trillion, which will be the 16th largest by 2050.

The Philippines is seen to become the largest economy in Southeast Asia with $1.688 trillion in GDP by 2050, outranking Indonesia ($1.502 trillion), Malaysia ($1.16 trillion) and Thailand ($856 billion).

By 2050, the Philippine economy will also be larger than the likes of Australia, Saudi Arabia, the Netherlands, Switzerland, South Africa, Austria, Sweden, Belgium, Singapore, Greece and Israel.

The report singled out the Philippines as the star performer during the period, “where the combination of strong fundamentals and powerful demographics gives rise to an average growth rate of 7 percent for the coming 40 years.”

It was based on the forecast that the per capita income of the Philippines will rise 6.1 percent annually from 2010 to 2020, 5.6 percent from 2020 to 2030, 5.2 percent from 2030 to 2040, and 4.8 percent from 2040 to 2050.

Per capita income of the Philippines will rise from $1,215 in 2010 to $10,893 while its population will increase from 93 million to 155 million during the period.

“Countries such as the Philippines, Peru and Nigeria all demonstrate some combination of favorable demographics and strong fundamentals that should see a significant rise in their economic size,” it said.

By 2050, China is projected to rise as the largest economy with $25.334 trillion, followed by the US with $22.27 trillion, India with $8.165 trillion, Japan with $6.429 trillion and Germany with $3.714 trillion.


HSBC’s projection for PHL: $1.69-T economy in 2050

THE Philippines is seen to become the 16th largest economy in the world by 2050—larger than even neighboring Indonesia, Malaysia, Thailand or even oil-producing Saudi Arabia or the Netherlands.

The British-owned global lender HSBC made the forecast in a study projecting the size of 100 economies 40 years hence, expanding the same from the original 30-country review published last year.

HSBC said the Philippine economy were to expand from the puny $112 billion at present into a leviathan capable of generating output worth $1.69 trillion or 15 times larger.

“Our ranking is based on an economy’s current level of development and the factors that will determine whether it has the potential to catch up with more developed nations. These fundamentals include current income per capita, rule of law, democracy, education levels and demographic change, allowing us to project the gross domestic product [GDP] forward,” the bank said.

HSBC said the forecast upgrade in the country’s economic standing was less the result of an increase of individual prosperity than as a result of the impact of its expanding population.

Bangko Sentral ng Pilipinas Governor Amando Tetangco Jr. earlier told reporters he considers the country’s rising population as a positive influence on growth rather than as contributor to eventual perdition.


“It is the small-population, ageing economies in Europe that are the big relative losers, seeing the biggest moves down the table,” HSBC said.


“There are some truly remarkable hot spots in Asia... The star performer, however, is the Philippines where the combination of strong fundamentals and powerful demographics gives rise to an average growth rate of 7% for the coming 40 years,” the report read.


HSBC said the Philippines was likely to post an average growth of 7 percent in the next 40 years.
Breaking down the average growth forecast, the bank said the country would likely grow by 8.4 percent from 2010 to 2020, by 7.3 percent from 2020 to 2030, and by 6.6 percent from 2030 to 2040, and by 5.8 percent from 2040 to 2050.

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