South Korea is expected to emerge as the world’s fourth richest country in terms of purchasing power in the 2040s, according to a report by Citigroup.
The country’s economic surge will be powered by its high levels of technology and human resources and would be further boosted by a possible reunification with North Korea, analysts said.
According to the U.S. investment bank’s report, cited by the Korea Center for International Finance, Korea is anticipated to rank among the world’s top 10 for per capita gross domestic product adjusted for purchasing power parity in 2020, fifth in 2030 and fourth in the 2040s.
Its GDP per capita is projected to reach $44,740 in 2020, $63,923 in 2030, $86,109 in 2040 and $107,752 in 2050, it said.
The GDP (PPP) per capita indicates a nation’s buying power under the assumption that price levels and foreign exchange rates are in equilibrium worldwide.
While Korea’s GDP per capita stayed at $20,500 at the end of 2010, the nation saw its GDP (PPP) per capita come to $30,280, according to the Bank of Korea.
The disparity between conventionally-calculated per capita GDP and PPP-based figure is due to relatively low consumer prices of Korea compared to those of major developed countries including Japan.
In 2009, Korea ranked seventh among 38 Asian-Pacific countries, posting $28,036 GDP (PPP) per capita, according to a research report by the Asian Development Bank.
Singapore topped the list with $50,795, followed by Brunei with $48,194, Hong Kong with $43,046, Australia with $37,132, Japan with $32,620 and Taiwan with $31,727.
The number of countries surpassing the $10,000 mark stood at nine in the Asian-Pacific region. Among they were Malaysia with $13,493 and Kazakhstan with $10,733.
Korea recorded $17,219 in 2000, while Japan had $25,624, 1.48 times as much. But the gap has narrowed down to about 1.16 times.
Meanwhile, despite expectations that Korea will be in the world’s top four for purchasing power by the 2040s, Citigroup forecast that Korea will not make the top 10 list for GDP scale between 2030 and 2050 after being included among the world’s 10 largest economies in the 2020s.
Countries such as Indonesia, Nigeria, Egypt and Mexico are projected to enter the top 10 GDP ranking.
“Though Korea holds high technologies, its competitiveness (for rapid growth) is likely to weaken as labor forces will gradually decrease,” said Lee Jong-hwa, an analyst of the Korea Center for International Finance.
By Kim Yon-se (firstname.lastname@example.org)