Friday, 22 May 2015

Map: The world’s economic center is shifting south and east

Map: The world’s economic center is shifting south and east

In at least one respect, the world today looks more like it did in 1,000 AD than in 1950. The map above shows that the global “economic center of gravity” is rapidly shifting east and south, and has almost returned to its location 1,000 years ago.

The map is based on a study by the McKinsey Global Institute, and uses the fascinating historical GDP estimates of Angus Maddison. The calculations should be seen as a rough estimate: In order to determine the “economic center” of the Earth, McKinsey weights the approximate center of a country’s landmass by its GDP.

Even so, the long-run historical trend is clear. In 1,000 AD, China and India accounted for two-thirds of global economic activity, and the global economic center was firmly in the Middle East. It remained there for roughly 1,500 years before shifting to Europe with the advent of the Industrial Revolution, and then toward North America. But East Asia’s stunning economic rise and urbanization in the last few decades, along with the growth of India and other emerging economies, has rapidly tugged the center back toward its origin. By 2025, the world’s economic center will be as far east as it was in 1,000 AD, though substantially farther north.

The chart comes from a book forthcoming in May, “No Ordinary Disruption: The Four Global Forces Breaking All the Trends,” by the directors of the McKinsey Global Institute McKinsey & Company’s flagship think tank. Republished courtesy of McKinsey & Company.

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