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PricewaterhouseCoopers: Developing world set to overtake the west

01 November 2008 09:12 (UTC +04:00)

Baku. Vahab Rzayev-APA-Economics. The looming global recession will trigger a dramatic shift in the economic balance of power to the emerging world that could see the west lose the dominance it has enjoyed since the dawning of the industrial age, according to one of Britainâ€™s leading consultancy firms.
Calculations by PricewaterhouseCoopers suggest that the lopsided nature of the downturn means the developed world may have only five years left before it is overtaken by developing countries led by China and India.
John Hawksworth, chief economist at PWC, said emerging market economies were likely to be hit much less hard by the global recession than the west, and were on course to account for more than 50% of world GDP by 2013 once the lower cost of living in poorer countries was taken into account.
"It is striking that such a significant shift in world GDP share from advanced economies to emerging economies could occur within as little as five years, and that from 2013 more than half of world GDP could come from these high growth countries."
According to the PWC calculations, the US would remain the worldâ€™s biggest economy but its share of global GDP would decline from 21.3% now to 18.8%.
China is on course to overtake the euro area as the worldâ€™s second biggest economy, while India would be challenging Japan for fourth place. On current trends Britain would see its slice of world output drop from 3.3% to 2.9% and be overtaken in the international league table by Russia. Between them the four so-called Brics - Brazil, Russia, India and China - would account for 26.5% of global GDP.