The growing importance of emerging markets is evident in new data from the Organization for Economic Cooperation and Development (OECD), which shows that the developed markets account for a declining share of world GDP.
Countries that belong to the OECD now account for slightly less than 50% of world GDP, in purchasing power parity (PPP) terms. This is down from about 60% in 2005 (the last year it benchmarked these numbers). At the same time, new data released by the International Comparison Program (ICP) shows large emerging economies (China, Brazil, India, Indonesia, Russia and South Africa) now account for about 30% of global GDP, up from 20% in 2005.
The OECD says that, in 2011, the three largest economies in the world were the U.S. (accounting for 17.1% of world GDP), China (14.9%) and India (6.4%). Canada’s share came in at 1.6%.
On a per capita basis, the OECD countries’ GDP (expressed in PPP) was about two and a half times the world’s GDP, it notes. And, actual individual consumption for the OECD was about three times the world average.
Per capita actual individual consumption in large emerging economies showed significant variation, the group notes; ranging from 1.75 times the world average in Russia to just 0.35 times in India.
The OECD and Eurostat calculated new 2011 benchmark PPPs for 47 countries, and these benchmark results were included in the new worldwide ICP comparison. The OECD maintains that PPPs are the relevant metric to make international comparisons of economic activity, as, unlike exchange rates, they correct for differences in price levels across countries.