Countries classified today as developing will dominate global savings and investment in less than a generation, according to the World Bank. India and China are forecast to provide 38% of the total investment by 2030.
In 17 years time developing countries will provide for more than
50% of the total global stock of capital, up from about 33% they do
today, the World Bank said in its Global Development Horizons
report. The largest portion of that stock will reside in East Asia
and Latin America. In absolute terms, China is projected to become
the largest saver by a landslide, accounting for $9 trillion in
2010 dollars by 2030. India ranks the second with its $1.7
trillion.
On the investment side, China is also projected to become the
largest, providing 30% of total investment by 2030. Taken together,
the remainder of the popular BRIC club of developing
nations – Brazil, India and Russia — will account for 13% of global
investment.
“Productivity catch-up, increasing integration into global
markets, sound macroeconomic policies, and improved education and
health are helping speed growth and create massive investment
opportunities, which, in turn, are spurring a shift in global
economic weight to developing countries,” the report
explained.
The service sector — one of the key criteria for distinguishing
between the developed and developing world — is also going to make
a huge leap in developing countries. Employment in services is
projected to become more than 60% of their total employment, which
brings them closer to the developed world.
Results of the research signal a real reshuffle in the alignment
of world economic forces, according to Maurizio Bussolo, lead
Economist and author of the report.
“GDH [Global Development Horizons report] clearly highlights
the increasing role developing countries will play in the global
economy,” he said.
This article originally appeared on : RT