9/15/15 10:21 AMHow the world will look in 2050 - Telegraph

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How the world will look in 2050

Rapid growth in emerging markets to establish new world order by 2050, as Britain slipsdown the global growth league, new research shows

The Mayan ruins of Palenque in south Mexico and the Temple of the Inscriptions Photo: REX FEATURES

By Szu Ping Chan

5:00AM GMT 10 Feb 2015

Britain will slip down the global growth league over the next three decades as an ageing populationand rapid growth in emerging markets helps Mexico and Nigeria to leapfrog the UK.

PwC predicts that Britain will slip out of the world's top ten largest economies by 2050, as Chinaasserts its dominance and India's young population helps it to overtake the US as the world's secondlargest economy.

The predictions, which are based on purchasing power parity (PPP) that take into account pricedifferences and buying power in each country, showed that Britain would move from 10th place in2014 to 11th by 2050.

9/15/15 10:21 AMHow the world will look in 2050 - Telegraph

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The forecast also showed that emerging market economies such as Indonesia, Mexico and Nigeriawould all be in the top ten by 2050. The median age of each country's population is less than 30,compared with an average age of 40 in the UK and 46 in Germany, according to CIA data.

However, Britain's relatively younger population and higher fertility rates compared with otherEuropean nations mean growth in the UK is expected to be stronger over the next few decades.Germany is forecast to fall from 5th to 10th place in the global growth leage by 2050, while France ispredicted to slip from 8th to 13th position and Italy from 12th to 18th.

“Emerging economies like Indonesia, Brazil and Mexico have the potential to be larger than the UKand France by 2030. Indonesia could rise as high as 4th place in the world rankings by 2050 if it cansustain growth-friendly policies," said John Hawksworth, PwC's chief economist.

“But despite expecting the UK to drop out of the top 10 largest economies by 2050, the projectedaverage UK growth rate to 2050 is stronger than other large Western European economies such asGermany, Italy and Spain that face even bigger challenges than the UK from ageing populations andslowing productivity growth."

The National Institute of Economic and Social Research (NIESR) said last night that it expects the UKeconomy to grow by 2.9pc this year, from a forecast of 2.5pc just three months ago. It believes interestrates will rise early next year as Britain's robust expansion continues and the impact of the recent fallin the oil price fades.

While China overtook America in PPP terms last year, in nominal terms, the country is not expectedto overtake the US until 2030, according to PwC. The analysis also showed that growth across theworld would begin to moderate after 2020, with China's current growth rate of around 7pc expected tomove towards "the advanced economy norm" of between 2pc and 3pc over the next few decades.

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