October 7, 2011

Which 10 Countries Have the Highest GDP?

MicroPlace investors want to make the world a better place for all. The majority of our investments target populations that are more economically challenged. But there are some misconceptions about where all the wealth in the world is . . . especially around the topic of gross national product.

When we think about gross domestic product, or GDP, wealth is often the first thing that comes to mind. The higher the GDP, the wealthier the country, right?

Well, sort of. Nominal GDP refers to the market value of everything – that is, every good and service produced in a country during a given time frame. Theoretically, countries with a higher nominal GDP will also be home to wealthier citizens.

But this isn't always the case.
Even the United States, which tops this list by a long shot, maintains an astonishingly high poverty rate of over 15%. Several other "high GDP" countries are also home to large impoverished populations. In Brazil, for instance, over a quarter of residents live in poverty.

There's also per capita GDP, which shows how big each person's share of GDP would be if income were equally distributed among everybody. But even per capita GDP can't accurately portray living standards, at least not by itself.

With those caveats, the following list shows the 10 countries with the highest nominal GDP – the total value of all goods and services produced within their borders – in 2010.


1. United States



A market-driven economy, the U.S. leads the world in technological development and innovation. In addition to having the world's highest nominal GDP, the U.S. boasts a higher per capita GDP than any other country on this list.

• GDP: $14.66 trillion
• GDP by sector: Services, 76.8%; Industry, 22.1%; Agriculture, 1.1%
• Per capita GDP: $47,200
• Population below the poverty line: 15.1%

2. China



China is the world's largest exporter. Market liberalization over the last several years has helped the country usurp Japan's position as the world's second largest economy. China has also dramatically increased their poverty rate in the last decade.

• GDP: $5.878 trillion
• GDP by sector: Services, 43%; Industry, 46.9%; Agriculture, 10.2%
• Per capita GDP: $7,600
• Population below the poverty line: 2.8%

3. Japan



Driven heavily by technology, Japan's economy weathered the initial effects of the 2008 downturn because its banks weren't heavily exposed to sub-prime mortgages. However, demand for the country's exports remains low due to the global recession.

• GDP: $5.459 trillion
• GDP by sector: Services, 73.8%; Industry, 24.9%; Agriculture, 1.4%
• Per capita GDP: $34,000
• Population below the poverty line: 15.7% (from 2007)

4. Germany



Europe's largest economy, Germany benefits from its highly skilled labor force and its exports across a number of industries.

• GDP: $3.316 trillion
• GDP by sector: Services, 71.3%; Industry, 27.8%; Agriculture, 0.9%
• Per capita GDP: $35,700
• Population below the poverty line: 15.5%

5. France



Although it may not be apparent from the stats below, France is one of the most visited destinations in the world. Tourism helps power its economy more than in any other country on this list.

• GDP: $2.583 trillion
• GDP by sector: Services, 79.5%; Industry, 18.5%; Agriculture, 2%
• Per capita GDP: $33,100
• Population below the poverty line: 6.2%

6. United Kingdom



Banking, insurance, and other business services account for the overwhelming majority of the UK's GDP.

• GDP: $2.247 trillion
• GDP by sector: Services, 77.5%; Industry, 21.8%; Agriculture, 0.7%
• Per capita GDP: $34,800
• Population below the poverty line: 14%

7. Brazil



The largest economy in South America, Brazil has experienced significant growth in the last few years. Today, its high interest rates make the country particularly attractive to investors.

• GDP: $2.09 trillion
• GDP by sector: Services, 67.4%; Industry, 26.8%; Agriculture, 5.8%
• Per capita GDP: $10,800
• Population below the poverty line: 26%

8. Italy



Production of high-quality consumer products by small enterprises accounts for much of Italy's industrial output. The country's underground economy is also quite large. Some estimates place its impact at as high as 15% of GDP.

• GDP: $2.055 trillion
• GDP by sector: Services, 72.8%; Industry, 25.3%; Agriculture, 1.9%
• Per capita GDP: $30,500
• Population below the poverty line: Unreported

9. Canada



Rich in natural resources, Canada is the largest foreign exporter of oil to the United States. The U.S. remains the nation's primary trading partner across a number of industries.

• GDP: $1.574 trillion
• GDP by sector: Services, 71.5%; Industry, 26.3%; Agriculture, 2.2%
• Per capita GDP: $39,400
• Population below the poverty line: 9.4%

10. India



Taking advantage of its large English-speaking population, India has recently emerged as a technological services powerhouse. Although roughly half of its population is somehow connected to agriculture, services still account for the majority of the country's GDP.

• GDP: $1.538 trillion
• GDP by sector: Services, 55.2%; Industry, 26.3%; Agriculture, 18.5%
• Per capita GDP: $3,500
• Population below the poverty line: 25%




Sources:

1 CIA, GDP (Official Exchange Rate), https://www.cia.gov/library/publications/the-world-factbook/fields/2195.html (Oct 2011).

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