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  • Writer's pictureShivaji Lokam

World's biggest economies ranked

Since the conclusion and decisive end of the Cold War, the world has witnessed rapid advancements in every sector. It has led to a free and open market system that allowed international trading, with every country fighting to stay on top. Historically, trading has been a popular activity for centuries because it enables interaction with the world's wealthiest and most powerful regions.

The top ten economies make up and contribute to around 66% of the World's economy. The top 20 economies contribute to approximately 79%, meaning that the remaining majority of world countries only equate to around 20% of the entire global economy. That shows the immense power of the five wealthiest countries ranked here and their influence on the emerging economies and global economic decisions.

The statistics derive from the International Monetary Fund database, which has been updated as of October 2020. The two statistics reflect nominal GDP and GDP using PPP (purchasing power parity). The latter considers the inflation rates and relative costs of goods and services rather than simple market exchange rates or economic analysis. However, it is known that the nominal GDP is generally used to represent the overall figure of a country's economy.

1. The United States

Nominal GDP: $22.66 trillion

GDP (PPP): $22.68 trillion

The United States has been undefeated in its position as the world's most robust economy since 1870's, after which its economy surpassed the United Kingdom. The United States dollar (USD) is one of the most powerful currencies internationally, and it is the most popular currency to trade overall.

2. China

Nominal GDP: $16.64 trillion

GDP (PPP): $26.66 trillion

Although China has a higher figure of PPP (purchasing power parity), its nominal GDP is notably less than that of the US. This leaves China second in the ranking of the wealthiest countries in the world. However, many consider PPP a more indicative and truthful representation of the economy, which it deems price inflation. China is the world's largest exporter of goods and manufacturing economy and the most significant international trade country.

3. Japan

Nominal GDP: $5.38 trillion

GDP (PPP): $5.59 trillion

Japan is known for its strong hold on the automobile industry, with notable brands such as Toyota, Honda, Nissan that contribute to a large proportion of the profits. The data must also note Japan's technological advancements in technology and natural sciences. The GDP growth also features several stocks from different sectors, including technology, transportation, consumer goods and finance.

4. Germany

Nominal GDP: $4.32 trillion

GDP (PPP): $4.74 trillion

Germany has a huge economy and is the leader of Europe's largest economies which relies heavily on exporting high-quality manufactured goods. Aside from a thriving stock exchange, Germany's treasury market contributes to its role as one of the largest economies in the world.

5. The United Kingdom

Nominal GDP: $3.12 trillion

GDP (PPP): $3.17 trillion

The UK currently has one of the most globalised economies in which international trade plays an important role. The services and goods sector contributes to around 80% of overall GDP, focusing on banking and finance, as the UK is the world's second-largest financial centre, after New York.

Following closely behind some of the largest economies are India, France, Italy, Canada, South Korea, and Latin America.

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