Richest Country in the World Still the U.S.

The richest country in the world is the U.S. The nation produces about 63% more goods and services each year than #2 China. Japan is third, followed by Germany. The U.S. produces $18.5 trillion in total dollar value each year, making it the world’s largest economy by far. China produces $11.38 trillion and Japan churns out $4.4 trillion. Next in line are Germany with $3.46 trillion, the UK with $2.76 trillion, France with $2.46 trillion and India with $2.28 trillion. Others in the top ten are Italy, Brazil and Canada. The chart and table below show the size of the top 50 countries, finishing with Peru. That country produces goods and services worth $178.6 billion per year. That’s about 1/100th the size of the U.S. economy. According to the World Bank and the UN, the European Union has the world’s richest economy. That said, the EU is an “economic union” and not a country so it doesn’t make our list. Including all non-country economies would make the NAFTA coalition the biggest economy in the world.

1. United States: GDP $18.5 Trillion

The United States is the richest country in the world by GDP. According to the International Monetary Fund (IMF), the U.S. has the world’s richest economy even considering the European Union. By IMF data, the U.S. economy creates goods and services worth $18.5 trillion per year while the EU produces $16.4 trillion. The U.S. economy features high productivity and abundant natural resources. The U.S. produces 24% of all the world’s goods and services. The country imports more goods than any other country in the world and exports more than any country except China. Top trading partners for the United States are China, Canada, Mexico, Japan and Germany. Its largest imported commodity is oil and it’s biggest export is transportation equipment. The majority of the country’s debt is held by the U.S. Federal Reserve, while the largest foreign U.S. debt holder is Japan.

2. China: GDP $11.4 Trillion

China is the second richest country in the world. With a population of 1.38 billion, it has more citizens than any other country on earth. It is also the second largest country by land area. The Chinese economy was the biggest in the world for nearly two thousand years. Currently, China has one of the fastest growing large economies in existence. China’s economy has grown as fast as 19% in 1970, settling into a slower but still fast 10% rate in 2009. In 2016 the country’s economy saw growth of 6.9%. While the Chinese economy is very “hot,” it is also characterized as highly inefficient. China consumes more energy than any other country and relies on coal for over 70% of all energy needs. It is also the world’s largest importer of foreign oil. Currently, five of the largest public companies in the world are Chinese.

3. Japan: GDP $4.4 Trillion

The third richest country is Japan. Japan is a volcanic archipelago of nearly 7,000 islands. With a population of 126 million, it is the tenth most populous country in the world. In the 1980’s the country saw economic growth of 7.5 percent. Its economy now grows at a rate of about 2.8%. The country has public debt of over 200% of annual GDP. That’s the largest debt to GDP ratio of any country on earth. A high debt to GDP ratio makes it very difficult for a country to pay down its debt. Japan scores very highly for economic freedom and competitiveness. It has a large industrial capacity and contributes to more of the world’s fish catch than any other country except China. It has a very low 4% unemployment rate.

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Richest Country in the World by GDP

The chart below shows the richest country in the world by GDP. The United States is first, with China a distant second. The economies of Japan, Germany, the UK, France, India and Italy come next. The GDP of all those economies taken together is about the same size as the U.S. economy. GDP is only one measure of a country’s wealth. GDP is a measure of what a country produces in a year. The U.S. produces $18.55 trillion in goods and services each year. That is 24% of the total goods and services produced by all the countries of the world. Many economists argue that ranking countries by GDP at “Purchasing Power Parity” (PPP) is a more useful measure of wealth. PPP takes a country’s cost of living into account. In other words, a country may be very rich but also have a very high cost of living. In terms of real goods and services produced however, straight GDP is still the most useful method of measuring the economic strength of a country.

4. Germany: GDP $3.46 Trillion

With a GDP of $3.46 trillion, Germany is the fourth richest country in the world. It has the biggest population of the European Union with 82 million inhabitants. It has a highly skilled labor force and a low level of corruption. Germany is the third largest exporter of goods in the world. 71% of its economy produces services including information technology. The rest is mostly industry, with 1% taken up by agriculture. 28 of the world’s Fortune Global 500 companies keep their headquarters in Germany. The country’s largest companies are Volkswagen, Daimler, E.ON, Allianz, BMW, Siemens and BASF. Germany is a leading member of the EU. Its economy grew at about 2.2% for most of 2016.

5. United Kingdom: GDP $2.76 Trillion

The world’s fifth richest country is the UK, composed of Great Britain and Northern Ireland. It has a population of 65 million and a GDP of $2.76 trillion. Its economy is 73% service related, with tourism making up a significant portion. The automobile industry employs more than 800,000 people in the UK. It also has the fourth largest aerospace industry in the world, behind the U.S., France and Germany. The country’s foreign debt of $9.6 trillion is the second highest in the world after the United States. The UK’s debt is 408% of its GDP. That makes it the third highest debt ratio in the world. Luxembourg and Iceland have the highest.

6. France: GDP $2.46 Trillion

The sixth richest country in the world, France has GDP of $2.46 trillion. The country has a population of 66.7 million and is home to 31 of the 500 biggest companies on earth. The French economy is subject to heavy government intervention. France’s government controls major segments of its infrastructure, including electricity, rail, nuclear power, aircraft and telecommunications. Since the 1990’s the government has gradually relaxed these controls. France’s economy has traditionally grown at a half a percent per year or less. The country is the sixth largest exporter of manufactured goods in the world. It is the fourth largest importer. France is one of the world’s top tourist destinations with 40,000 chateaux and the most visited are museum in the world, the Louvre.

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7. India: GDP $2.28 Trillion

India comes in seventh on the richest country in the world list. Its population of nearly 1.3 billion people produce goods and services worth $2.28 trillion per year. It has seen a high growth rate of 5% to 6% in recent years and has one of the world’s fastest growing economies. That said, its high population means a low per-capita GDP and high poverty levels. In terms of GDP per capita, the country is 140th out of all countries. India’s government until 1991 was largely protectionist and socialist. Widespread regulation and economic intervention isolated the country’s economy from the rest of the world. During the 1990’s India liberalized its economy. Since then it has gradually moved its economy to a free market system. With increased foreign trade and direct investment, its GDP has grown significantly through the 90’s and the new millennium.

8. Italy: GDP $1.84 Trillion

Italy is the eighth richest country in the world, with a GDP of $1.84 trillion. The country has a population of just over 60 million and is one of the most industrialized nations on earth. It also has the eighth highest quality of life according to The Economist and the sixth largest manufacturing segment of any country. It is the world’s seventh largest exporter. Its economy shrank after the great recession from 2008 through most of 2015. Since then it has seen minimal growth of less than one percent per year. The country’s government attempted to boost its growth recently with massive government spending. Those efforts created a sharp increase in public debt to 135% of GDP. However, most of that debt is owned by Italian subjects and companies rather than foreign interests. Italy’s unemployment rate is a high 12%.

9. Brazil: GDP $1.53 Trillion

The ninth richest country in the world, Brazil has a GDP of $1.53 trillion. Brazil has a relatively high population of 206 million. By land mass it is the largest country in Latin America. It has more Portuguese-speakers than Portugal and boasts extensive natural resources. Up until 2010 it also had one of the fastest-growing economies in the world, with annual growth reaching 10% in some years. More recently its growth rate has fallen into negative numbers, with the economy shrinking by nearly 6% during some months of 2016. A political corruption scandal has seen widespread protests and the removal of Brazil’s president. According to the BBC, public money was used to bribe the country’s Congress to buy votes for favored programs. Brazil is the world’s largest exporter of coffee and the fourth largest market for cars.

10. Canada: GDP $1.46 Trillion

The tenth richest country in the world is Canada with GDP of $1.46 trillion. Canada has a relatively small population of 36 million, making it one of the world’s richest countries per capita. It has a relatively low level of income inequality and high disposable income per household. The country has more than 1,500 companies with combined market capitalization of more than $2 trillion. Most of its imported manufactured goods come from the United States. Canada’s economy is mostly dominated by services. Its economic growth hasn’t broken an average of 1% over the past ten years. During part of 2016 the country’s economy actually shrank. Canada is the most educated country in the world. More than 50% of its inhabitants have college degrees.

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A Different Measure of the Richest Country in the World

Straight GDP or Gross Domestic Product is only one way of finding the world’s richest country. Another way is by adjusting GDP with Purchasing Power Parity (PPP). PPP takes cost of living into account. In other words, it’s one thing to say the U.S. is the wealthiest country on earth because it has the largest economy than any other. However, the residents of the country have to use their money to buy things in that rich country also. It’s like the idea that people who live in San Francisco can generally earn a lot more money than those living in rural areas, but they also have to spend more of that money to live. The 2016 GDP PPP ranking has China as the #1 country on earth with an adjusted GDP of $20.85 trillion. The U.S. is second, with India, Japan, Germany, Russia, Brazil, Indonesia, the UK and France filling out the top ten.

Source:

International Monetary Fund Richest Country in the World List