We recently compiled a list of the 50 Richest Countries in the World by GDP and in this article we will talk about the country with the largest GDP in the world.
Global Economic Outlook of Richest Countries
The global economy has been facing strong headwinds since the COVID-19 pandemic including the world’s richest countries by GDP. The major economic issues include high inflation, high interest rates, and geopolitical risks. Japan’s economic situation looks bleak and the country’s GDP has plunged during the last two quarters. Japan’s GDP shrank by 3.3% in Q1 2024 and 0.4% in Q4 2023 year-over-year. In the ongoing economic shift, Japan lost its position as the third-largest economy with its GDP at around $6.72 trillion, as of 2024. On May 9, Reuters reported that the Bank of Japan could raise interest rates if the yen drops sharply, leading to higher inflation. Recently, the Bank of Japan ended eight years of negative interest rates, changing the policy following decades of aggressive monetary easing. Japan’s new interest rate ranges between 0% to 0.1%. Japan’s central bank board member, Seiji Adachi, said that the bank can move towards increased interest rates if excessive yen falls persist. Adachi further added:
“We must by all means avoid raising interest rates prematurely. But by focusing too much on downside risks, we could see inflation accelerate in a way that forces us to tighten monetary policy sharply later on. As long as underlying inflation continues to head toward 2%, it’s important to gradually adjust the degree of monetary support reflecting economic, price, and financial developments.”
In the global economic shift, another major economy that has been in the limelight for fighting the recession is the United Kingdom. The United Kingdom has been surpassed by India, Russia, Indonesia, and Brazil as the richest countries in the world by GDP. The UK’s inflation is measured at 2.3% compared to 3.4% in the US and 2.4% in the eurozone. On May 27, Olli Rehn, the European Central Bank governing council member in a speech said that the inflation rate in the eurozone is falling in a ‘sustained way.’ Rehn further said, “The time is thus ripe in June to ease the monetary policy stance and start cutting rates.”
China, the largest manufacturing country in the world, has received an upgrade on its economic outlook from the International Monetary Fund (IMF). On May 28, the IMF reported that it has revised China’s economic outlook, increasing growth by 0.4 percentage points for 2024. As per the updated projection, China’s economy is expected to grow by 5% in 2024 and 4.5% in 2025. One of the major reasons for the upside in China’s economic growth is the downside expected in the property sector. Here is what the IMF’s First Deputy Managing Director, Ms. Gita Gopinath, said:
“The ongoing housing market correction, which is necessary for steering the sector towards a more sustainable path, should continue. The authorities have implemented various welcome measures to guide the property market transition, including recent policy announcements regarding lending support for affordable housing.”
The US economy is projected to have a 2.7% growth rate in 2024, a slightly higher growth compared to 2.5% in 2023. In 2025, the growth for the US is anticipated to decline to 1.9%. The chief US economist, Andrew Hollenhorst, in a CNBC interview, said that they are not seeing a soft landing in the US. Hollenhorst pointed, “We’re just not seeing (soft landing) it in the data.”
Overall, the global economy is set to continue growth at 3.2% during 2024 and 2025. In advanced economies, the growth is projected to stay under 2% in 2024 and 2025, while emerging markets and developing economies expect a 4.2% growth in 2024 and 2025. As per the IMF’s forecast, India will be the leading economy with an anticipated growth rate of 6.8% and 6.5% in 2024 and 2025, respectively.
China Vs United States: An Economic Tassle
China and the United States have been up against each other for decades now. China’s stellar economic growth has led the country to directly compete with the US economy. As per the IMF, China’s anticipated growth rate of 5% and 4.5% for 2024 and 2025 is almost double the expected growth rate of the US. However, the Chinese economy has been struggling with a property crisis, which has left a huge dent in the real estate market. On April 16, Reuters reported that the new home prices in China plunged by 2.2% in March 2024 from a year ago, representing the biggest decline since August 2015. The property downturn in China will lead to a 0.3 percentage point decline in Chinese GDP growth in 2024, as per the economists at ANZ. Whereas, property investment is expected to decline by 12% in 2024. Despite the downsides, China is on track to be the largest economy in the world by 2030. In addition, China is one of the richest countries in the world by net worth, having a total wealth of $85.10 trillion in 2021. The US had the highest total wealth of around $145.79 trillion, as of 2021.
The US economy is suffering from interest rate hikes and heading towards a potential recession. The expected growth of 1.9% in 2025 indicates recessionary risks. Moreover, the high inflation has kept the Fed to keep the interest rates between 5.25% to 5.5%. On May 21, CNBC reported that Fed Governor, Christopher Waller, pointed out that he would need to see several months of inflation data before deciding to lower rates.
Companies Backing the Largest Economies
Walmart Inc. (NYSE:WMT) is one of the largest retailers in the US. On May 16, Walmart Inc. (NYSE:WMT) reported its earnings for the first quarter of 2025. The company posted earnings per share of $0.60, surpassing consensus estimates by $0.07. Walmart Inc. (NYSE:WMT) reported a revenue of around $159.94 billion, beating estimates by $1.67 billion. Here are some of the comments from the Q1 2025 earnings call:
“Our results were stronger than we anticipated with sales growth of 5.7% and adjusted operating profit, up 12.9% in constant currency. All three operating segments performed well. The momentum we see across the businesses driven by growth in units sold and transaction counts, as well as market share gains, including general merchandise. These are not inflation-driven results. In the U.S., like-for-like sales inflation was about 40 basis points for the quarter, including mid-single-digit deflation in general merchandise and low-single-digit inflation in food and consumables. Together with our suppliers, we’re making progress lowering prices.”
Tencent Holdings Limited (OTC:TCEHY) is one of the largest tech companies in China. Tencent Holdings Limited (OTC:TCEHY) is supporting the economy through its next generation of low-carbon technologies. In March 2023, Tencent Holdings Limited (OTC:TCEHY) launched CarbonX to reduce its carbon footprint. The tech giant has committed over $28 million over the next three years to support innovative ideas that will focus on technology-based carbon removal. On May 23, Tencent Holdings Limited (OTC:TCEHY) reported that it will award a total of $14 million to 13 teams that won the first phase of the CarbonX program.
The world’s richest countries by GDP are backed by strong multinationals. With this context, let’s take a look at the 50 richest countries in the world by GDP.
An expansive view of the cityscape, showing the impact of the company’s activities in China.
Our Methodology
To compile the list of the 50 richest countries in the world by GDP, we shortlisted the countries based on their GDP (PPP) from the International Monetary Fund database. The countries with the highest GDP (PPP) are ranked in ascending order of their GDP, as of 2024. Purchasing Power Parity (PPP) figures are being used as PPP calculates the conversion of currency rates that equalize the purchasing power of different currencies by excluding the price level differences between countries.
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The Richest Country in the World by GDP
1. China
GDP (PPP): $35.29 Trillion
China has surpassed the US as the richest country in the world by GDP, with a GDP of $35.29 trillion, as of 2024. China’s economy is backed by a large manufacturing capacity as it is the largest manufacturing country in the world. China has a high growth prospect with a projected growth rate of 5% in 2024 and 4.5% in 2025, while the US is fearing recession with its projected growth rate of 1.9% in 2025.
To learn about other countries that have large GDPs, check out our free report on the 50 Richest Countries in the World by GDP.
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