According to CNBC’s analysis of IMF economic forecasts, the United States, China, Japan and Germany still rank the top four largest economies in the world, but some positions have changed due to the pandemic, and one country dropped out of the top 10 list.
CNBC compared nominal gross domestic product in US dollars across countries represented in the IMF’s World Economic Outlook database.
Nominal GDP estimates the market value of all finished goods and services produced in the economy, but does not exclude changes in price levels or inflation, and therefore may overestimate or underestimate the real economic value.
However, the nominal values of GDP, expressed in a single currency, help to determine and compare the size of the economy of different countries and make it possible to understand that events such as a pandemic affect the economy in different ways.
Below are the main changes in the ranking of the 10 largest economies in the world before and after the Covid outbreak.
Top 10 economies by nominal GDP in 2019
India dropped below Great Britain
India, which became the fifth largest economy in the world in 2019, dropped to sixth place after the UK last year.
According to CNBC’s analysis of IMF data, the South Asian country will not be able to return to fifth place in the global economic rankings until 2023.
India has been hit by tough quarantines last year in an attempt to contain the coronavirus. According to IMF forecasts, the country’s economy contracted by 8% in the fiscal year ending March 2021.
While the Fund expects India to grow 12.5% in the current fiscal year, which ends in March 2022, some economists warn that the latest spike in Covid cases could undermine the country’s prospects. Last week, India overtook Brazil to become the second most infected country in the world, behind only the United States.
“We are increasingly worried that the rising incidence of Covid-19 is threatening a still weak recovery,” economists at Bank of America wrote in a report Monday.
Economists have calculated that one month of nationwide quarantine – if reintroduced – would reduce India’s annual GDP by 100-200 basis points.
Brazil dropped out of top 10
Brazil was the ninth largest economy in 2019, but dropped to 12th last year, becoming the only country to leave the top ten.
This South American country will remain outside the 10 largest economies in the world until at least 2026 – the most distant IMF forecast, CNBC analysis showed. Brazil has the second highest number of Covid-19 deaths after the United States.
Brazil reported the third highest number of Covid cases and the second highest death toll in the world. However, President Jair Bolsonaro, who is downplaying the threat of the virus, has repeatedly refused to impose a nationwide quarantine to limit the spread of the coronavirus.
São Paulo’s health minister reportedly warned the federal government of an “imminent” collapse of the state’s health care system, while economists said the Brazilian economy would have to work hard to recover.
Last year, the economy contracted 4.1% and, according to IMF forecasts, will grow by 3.7% in 2021.
South Korea entered the top 10
After Brazil dropped out of the top 10 economies in the world, South Korea climbed to 10th place and is expected to remain there until at least 2026. The forecast according to the IMF data is available only until 2026.
South Korea became one of the first countries outside of China to report Covid-19 cases in early 2020. In the past year, the country has made some progress in containing the virus, which – along with high exports of semiconductors – the country’s economy contracted by just 1% in 2020.
The number of new daily infections rose this month, prompting authorities to extend social distancing measures, which include restrictions on crowds until early May.
Economists at consulting firm Capital Economics said in a report last week that the country’s manufacturing and export sectors remain stable despite uncertainty over the virus.
“Consumption is also becoming increasingly resilient to outbreaks of the virus, thanks in part to the rise in online shopping. However, the areas of hospitality and recreation are still very weak, ”they added.
The IMF predicts that South Korea’s economy could grow 3.6% this year.