In this article, we will look at the 5 Most Powerful Countries in the World by Economy.
Global Economic Outlook
The United States of America, China, and Germany are some of the most powerful countries in the world by economy. Factors including strong GDP growth, low inflation rates, increased employment opportunities, and strong investment determine a country’s economic power. In addition to these factors, the overall world economic outlook also contributes to the economic performance of these countries. According to the International Monetary Fund (IMF) April 2024 update, the world economy grew at 3.2% in 2023 and is forecasted to continue growing at the same rate in 2024 and 2025. The advanced economies of the world are expected to witness a slight increase in growth rate and are forecasted to grow at 1.7% in 2024 as compared to a 1.6% growth rate in 2023. On the other hand, growth for emerging and developing economies is expected to slow down modestly from 4.3% in 2023 to 4.2% in 2024.
Global headline inflation is easing and was close to the pre-pandemic level in late 2023 for most economies. During the last quarter of 2023, headline inflation was recorded to be 2.3% down from 9.5% in the second quarter of 2022 in a quarter-wise analysis. While headline inflation for emerging and developing countries has also cooled down from its peak of 13.7% in the first quarter of 2022, it is still considerably high and was recorded at 9.9% in the last quarter of 2023. The mean inflation rate for developing countries is high due to uncontrolled inflation in some countries. For instance, on May 3rd, Reuters reported that annual consumer price inflation in Turkey climbed up by 69.8% in April, the rise was still below expectations, however, it was the highest since late 2022. The Finance Minister of Turkey, Mehmet Simsek, said that though inflation will peak in May, it will start to ease sharply to be in line with the government’s prediction. If you want to read more about economies of the world you can look at 12 European Countries with the Best Economy Right Now and 30 Countries with the Best Economy in the World Right Now.
Some of the Largest Companies from the Most Powerful Economies
Microsoft Corporation (NASDAQ:MSFT) and Saudi Arabian Oil Company (TADAWUL:2222) are two of the leading companies leading the global economy. Let’s discuss some updates from them.
On May 8th, Microsoft Corporation (NASDAQ:MSFT) announced $3.3 billion in Wisconsin to strengthen artificial intelligence economic activity, innovation, and job creation. The investment package is designed to upgrade Southeast Wisconsin as a hub of cloud computing, and will also lead to the building of the country’s first manufacturing-focused Artificial innovation lab. Moreover, the initiative also aims to address the skill gap within the state and will help equip over 100,000 residents with essential AI skills. The president of the United States, Joe Biden along with the president of Microsoft Corporation (NASDAQ:MSFT), Brad Smith announced this new investment package at Gateway Technical College.
Saudi Arabian Oil Company (TADAWUL:2222) is an integrated energy and chemical company based in the Kingdom of Saudi Arabia with operations running internationally. The company operates in the upstream and downstream segments and deals with the exploration, development, and production, of hydrocarbon products, and other related chemicals. On April 27th Saudi Arabian Oil Company (TADAWUL:2222) announced that it is exploring a joint venture in its Saudi Aramco Jubail Refinery Company with its Chinese partner Rongsheng Petrochemical Co., Ltd. (SHE:002493) as a new downstream partner. Saudi Arabian Oil Company (TADAWUL:2222) recently signed a cooperation framework agreement that envisions Rongsheng Petrochemical Co., Ltd. (SHE:002493) acquiring 50% of the stake in the Saudi Aramco Jubail Refinery Company. The agreement also lays the foundation for the development of liquid-to-chemical expansion projects at the refinery. The Aramco Downstream President, Mohammed Y. Al Qahtani, said that this partnership is a step towards key geographical expansions and to attract investment in the Saudi downstream sector.
With that, let’s look at some of the most powerful countries in the world by economy.
5 Most Powerful Countries in the World by Economy
Our Methodology
To create the list of 5 most powerful countries in the world by economy, we relied on four main economic indicators including GDP at current prices, real GDP growth rates, GDP per capita (PPP), and GDP per capita growth rates, all sourced from IMF. We used the GDP at current prices as our primary metric to rank the countries. GDP is one of the most commonly used single measures to gauge a country’s overall economic activity and represent the total value of all the final goods and services produced within a country during a year. We have used recent data for 2024 for all of our indicators. The list is arranged in ascending order of countries’ GDP.
5 Most Powerful Countries in the World by Economy
5. India
GDP Current Prices (2024): $3.937 trillion
Real GDP Growth Rate (2024): 6.8%
GDP Per Capita (PPP) (2024): $10,120
GDP Per Capita Growth Rate (2024): 9.00%
India ranks 5th on our list of the 20 most powerful countries in the world by economy. It is also one of the fastest-growing economies in Asia. The country has a GDP of $3.937 trillion, with a growth rate of 6.8%. Moreover, the country’s GDP per capita is growing at 9.00% during 2024.
4. Japan
GDP Current Prices (2024): $4.110 trillion
Real GDP Growth Rate (2024): 0.9%
GDP Per Capita (PPP) (2024): $54,180
GDP Per Capita Growth Rate (2024): 1.78%
Japan ranks 4th on our list of most powerful countries in the world by economy. It is an East Asian country with a population of 124.04 million as of 2024. The GDP and GDP per capita of Japan are growing at 0.9% and 1.78% during, respectively, during 2024.
3. Germany
GDP Current Prices (2024): $4.591 trillion
Real GDP Growth Rate (2024): 0.2%
GDP Per Capita (PPP) (2024): $67,240
GDP Per Capita Growth Rate (2024): 6.08%
Germany not only ranks as the 3rd most powerful country in the world by economy, but it is also one of the most innovative economies in Europe. The country is renowned for its high technology exports and has a GDP of $4.491 trillion as of 2024.
2. China
GDP Current Prices (2024): $18.533 trillion
Real GDP Growth Rate (2024): 4.6%
GDP Per Capita (PPP) (2024): $25,020
GDP Per Capita Growth Rate (2024): 4.90%
China ranks 2nd on our list of most powerful countries in the world by economy. The country has a GDP of $18.533 trillion, which is growing at 4.6% in 2024. Moreover, China’s GDP per capita is growing at 4.90%.
1. United States
GDP Current Prices (2024): $28.781 trillion
Real GDP Growth Rate (2024): 2.7%
GDP Per Capita (PPP) (2024): $85,370
GDP Per Capita Growth Rate (2024): 3.30%
The United States is the most powerful country in the world by economy. It is a huge country with a population of 337.12 million as of 2024. Moreover, the United States has a GDP of $28.781 trillion, which is growing at a rate of 2.7% during the current year.
These were the 5 most powerful countries in the world. If you want to learn more about the most powerful countries, you can take a look at the 20 Most Powerful Countries in the World.