Global GDP growth varies each year. Over the past few years, global GDP growth has been 2-3%. However, due to the COVID-19 pandemic, global GDP growth was affected in 2020, with a contraction of 4.4%. In 2021, the IMF projects global GDP growth of 5.5%. However, these projections may vary due to unpredictable economic and political factors.
What is GDP?
GDP (Gross Domestic Product) is a measure of the economic output of a country or region. It is calculated by adding the value of all final goods and services produced within a country or region over a given period of time, usually one year. GDP is considered a key indicator of the economy of a country or region, as it reflects the level of economic activity and the general well-being of the population. GDP is also used to compare the economic performance of different countries or regions.
Countries with better GDP
The countries with the highest GDPs in nominal terms vary each year due to changes in the global economy. However, the countries with the highest nominal GDP in 2021 are the United States, China, Japan, Germany and the United Kingdom. However, GDP per capita, which measures GDP divided by population, is a better way to compare economic well-being between countries with different populations. The countries with the highest GDP per capita in 2021 are Luxembourg, Switzerland, Norway, Iceland and Denmark.
Difference in nominal and per capita GDP
Nominal GDP is the total value of all final goods and services produced within a country or region in a given period of time, usually one year, expressed in current currency. Nominal GDP is used to measure the size of a country or region’s economy.
On the other hand, GDP per capita measures GDP divided by the population of a country or region. That is, it is the nominal GDP divided by the population of a country or region. GDP per capita is a way of comparing economic well-being between countries or regions with different population sizes. GDP per capita is usually expressed in terms of one current currency per person.
For example, if a country has a nominal GDP of $1 trillion and a population of 100 million, its GDP per capita is $10,000. However, if another country has a nominal GDP of $500 million and a population of 50 million, its GDP per capita is $10,000. Although the nominal GDP of the two countries is different, the GDP per capita is equal, indicating that the economic well-being of the population is similar in both countries.
