What would the world economy look like if it would be split into equal chunks of (roughly) $1 trillion in GDP? The US economy would break apart in 14 parts. The Russian economy would just represent 1 chunk. Also, (sub-Saharan) Africa would be reduced to just 1 circle. Metropolitan areas like London, Tokyo, Shanghai, New York, Paris, would have their ‘own’ region. China is growing fast with 6 circles and counting. Of source, all the criticisms and caveats of the Gross Domestic Product-indicator apply. (source)
Last week, a Redditor by the name of allattention made the following animated map, plotting both the GDP growth for the world in the timeline and the yearly GDP change per capita in all the countries. The data shown runs from 1961 until 2016 and was extracted from the World Bank. The GIF shown is only thirteen seconds long, and shows just how destructive the 2009 financial crash was. Moreover, in the full animation, data from the Russia Federation and most of Eastern Europe is only shown from 1994 onwards, since the data brought out from the CCCP was not trusted. The entire animation can be found here.
On the sixteenth of March, the Federal Reserve Bank lifted its key interest rate from 1.50%, to 1.75%. This is the highest it’s been since 2008. It was the first major decision under the new Chairman Jerome Powell, and was made because of the continued growth and strengthening of the US economy. However, there’s one major concern regarding this decision: the interest spending and the size of the debt of the US. As shown in the graph, made by the Committee for a Responsible Federal Budget (CRFB), they estimate that interest costs will total $6.8 trillion over a decade and $965 billion in 2028. With just 1 percentage point annual increase in interest rates above CBO’s projection, this number would increase interest costs by $2 trillion (to $8.8 trillion) over a decade and by $325 billion (to $1.3 trillion) in 2028. Scenarios with an even higher percentage point increase are also shown. Moreover, the CRFB estimates that with the new key interest rate, the debt (to GDP) will grow to 101%, and would be at 107% with an increase of the key interest rate of 1%. (source)
Government debts in sub-Saharan Africa are starting to pile up once more. Debt was a huge issue on the majority of the African continent in the 90s and early 2000s, however, according to The Economist, some of these debts were waved away by institutions as the World Bank, IMF and the African Development Bank. From 2006 on to 2012, the now lowered debts largely remained the same, supported by fresh credit and new economic policies. This led to an average debt-of-GDP of 30% in sub-Saharan Africa for 2012. However, in the last few years we see a rise in these debts, and although these numbers don’t seem high, African countries in general collect fewer taxes, while also paying higher interest rates. This means that it is harder for these countries to lend money, and if they do, they pay higher interest rates.
If UK Chancellor Philip Hammond is to be believed, the light at the end of the tunnel is coming closer and closer. He told this on the Andrew Marr show on March 11th. Hammond was talking about the debt of the UK, which is at 86% of GDP and if the forecasts of the UK treasury are true, the debt will shrink even further over this fiscal year. This news comes at the end of a week, in which Labour Party members, as well as fellow Tories have publicly asked for relaxations on the austerity measures in the UK. These calls have become more increasingly loud, after the cash-strapped National Health Service has again struggled to keep up with a surge in winter illnesses. (source)
This map shows that in terms of Gross Domestic Product (GDP), the Russian economy ($1470 billion) is about the size of The Netherlands ($825 bn), Belgium ($492 bn) and Luxembourg ($64 bn) combined. However, in terms corrected for purchasing power, Russia’s economy is almost three times bigger ($4000 bn) while the economies of Netherlands ($900 bn), Belgium ($530 bn) and Luxembourg ($64 bn) remain roughly the same. Of course, GDP and economic power, let alone political power aren’t the same vide the role of Russia’s (cheap) internet trolls. (source)