By Rob Starr, Content Manager, Big4.com
According to the latest update of the PwC ‘The World in 2050’ series of reports, the UK is predicted to drop to 11th place in rankings of the world’s largest economies by 2050 and the global financial crisis and its aftermath has accelerated the shift of the economic centre of gravity to China, India and other emerging economies.
The PwC report highlights the pressure on natural resources from rapid growth in emerging economies and also cites a number of sources that could derail emerging market growth such as:
• High fiscal deficits in India and Brazil
• Over-reliance on oil and gas revenues in Russia and Nigeria
• Rising income inequality leading to social tensions in China and other fast-growing economies
• Macroeconomic and financial instability in Vietnam.
John Hawksworth, chief economist at PwC, said:
“Although we expect the UK to drop out of the top 10 largest economies by 2050, the projected average UK growth rate to 2050 of just over 2% is similar to France and stronger than for other large Western European economies such as Germany, Italy and Spain that face even bigger challenges than the UK from an ageing population and declining labour forces in the long run.”