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INTRODUCTION
3G countries or Global Growth Generators countries are 11 countries economies which have been identified as sources of growth potential and of profitable investment opportunities
This research was done by Citi Investment Research & Analysis division of Citigroup Global Markets Inc.
The Citi report, prepared by analysts Willem Buiter and Ebrahim Rahbari
INTRODUCTION
Analysts forecasted that growth in the world economy until 2050, with average real GDP growth rates of 4.6% pa until 2030 and 3.8% pa between 2030 and 2050 as a result, world GDP should rise in real PPP from 73 trillion USD in 2010 to 377 trillion USD in 2050. The most promising growth prospects countries are Bangladesh, China, Egypt, India, Indonesia, Iraq, Mongolia, Nigeria, Philippines, Sri Lanka and Vietnam are our 3G countries
INTRODUCTION
Fastest growing regions: developing Asia and Africa China will overtake the United States to become largest economy in the world by 2020, than India will overtake by 2050. Followed by the Middle East, Latin America, Central and Eastern Europe, the CIS, and finally the advanced nations of today.
INTRODUCTION
The forecast is based on three sources of information for 58 countries accounting for 85% of global GDP prepared by the 50 economists on Citis Economics team.
A set of individual country forecasts of GDP (real GDP using PPP exchange rates and dollar GDP using market exchange rates) per capita GDP inflation and market exchange rates
GROWTH DRIVERS
Domestic
capital formation (as a share of GDP) Gross domestic saving (as a share of GDP) Human capital, demographic, health and educational achievement. Quality of institution and policies. Trade openness. the initial level of per capita income.
Gross fixed capital formation, as a percentage of GDP, obtained from the World Bank World Development Indicators A high rate of domestic capital formation is therefore a precondition for sustained high rates of growth. Domestic capital formation can be financed out of external savings (through a current-account deficit on the balance of payments, that is, through capital inflows).
The saving/investment variable is constructed by taking an unweighted average of 2006 2009 averages of gross national savings
In practice most countries that have achieved and sustained high domestic investment rates have financed the bulk of this out of domestic saving
The rule of law, stability and predictability of regulation and taxation Political and Social institutions Microeconomic and Macroeconomic Policies
Trade openness
The two dimensions of openness that matter most for growth:
BANGLADESH
GDP per capita: $1735 Average growth 2010-2050: 6.3% 3G Index Score: 0.39
2010
CHINA
GDP per capita: $7430 Average growth 2010-2050: 5.0% 3G Index Score: .81
2010
EGYPT
GDP per capita: $5878 Average growth 2010-2050: 5.0 3G Index Score: .37
2010
INDIA
GDP per capita: $3298 Average growth 2010-2050: 6.4% 3G Index Score: 0.71
2010
INDONESIA
GDP per capita: $4363 Average growth 2010-2050: 5.6% 3G Index Score: 0.70
2010
IRAQ
GDP per capita: $3538 Average growth 2010-2050: 6.1% 3G Index Score: 0.70
2010
MONGOLIA
GDP per capita: $3764 Average growth 2010-2050: 6.3% 3G Index Score: 0.63
2010
NIGERIA
GDP per capita: $2335 Average growth 2010-2050: 6.9% 3G Index Score: 0.25
2010
PHILIPPINES
GDP per capita: $3684 Average growth 2010-2050: 5.5% 3G Index Score: 0.60%
2010
SRI LANKA
GDP per capita: $4988 Average growth 2010-2050: 5.5% 3G Index Score: 0.33
2010
VIETNAM
GDP per capita: $3108 Average growth 2010-2050: 6.4% 3G Index Score: 0.86
2010
Potential 3G countries
Iran and North Korea could catch the 3G countries if they achieve political transitions and open their economies. Some might add Argentina, Myanmar, and Venezuela. Whether Mexico, Brazil, Turkey and Thailand will catch 3G countries depends on increasing their domestic saving/investment rates substantially. Some developed countries, such as Ireland, Canada, Australia and the USA could also become 3G countries.