The World Economy in One Picture
I’d highly recommend Danny Quah’s short (7 page) note on the world’s centre of economic gravity. I think it is the clearest, and certainly the most vivid, demonstration of the key trends in the global economy I’ve seen. Because one trend is key – economic power is moving east.
The key map is below (black points are historic ones from 1980 until 2008, red are projections):
As Danny explains:
This note describes the dynamics of the global economy’s centre of gravity. Such dynamics form part of more general ongoing research on the world’s shifting distribution of economic activity (Quah 2010). By economic centre of gravity, I mean the average location of the planet’s economic activity measured by GDP generated across nearly 700 identifiable locations on the Earth’s surface. The calculations in this note take into account all the GDP produced on this planet.
I report below that the world’s economic centre of gravity located in 1980 at a point in the middle of the Atlantic Ocean. By 2008, however, that centre of gravity had drifted to a location at about the same longitude as Izmir and Minsk, and thus east of Helsinki and Bucharest. This change occurred not due of course to the emergence of Turkey or Belarus, but instead from the continuing rise of China and the rest of East Asia.
Extrapolating growth in the 700 locations across Earth, the world’s economic centre of gravity is projected by 2050 to locate, literally, between India and China. Observed from the Earth’s surface, that centre of gravity will move a distance of 9300 km, or 1.5 times the radius of the Earth, from its 1980 location.
There we have it, thirty years ago the world’s centre of economic activity was in the mid Atlantic, today it is around Turkey, in thirty years time it will have reached India and China. This is the new globalization and I’d like to hear how Western politicians plan on dealing with it.