December 08, 2022 (MLN): Pakistan will likely become the world's 6th largest economy by 2075 if appropriate policies are taken into consideration, the latest report “The Path to 2075” published by Goldman Sachs projected.
While the five largest economies will be China, India, the US, Indonesia, and Nigeria by 2075, the report added.
Goldman Sach has been projecting long-term growth for the economies for two decades. In the beginning, it started from BRICs countries but later expanded to 70 countries and the latest report covered 104 economies.
Economists Kevin Daly and Tadas Gedminas have forecasted Pakistan's future performance on the back of GDP growth, population growth, technical progress, and capital contribution which along with Egypt and Nigeria, could place it among the largest economies in the world in the next 50 years.
"The prospect of rapid population growth in countries such as Nigeria, Pakistan, and Egypt implies that – with the appropriate policies and institutions – these economies could become some of the largest in the world," the report read.
By this time, Pakistan’s Real GDP is forecasted to have grown to $12.7 trillion while the GDP per capita will grow to $27,100.
The key risk to the long-term projection includes populist nationalism and environmental catastrophe.
Populist nationalism leads to increased protectionism and a reversal of globalization. Populist nationalists have gained power in several countries and the supply chain disruptions during the Covid pandemic have resulted in an increased focus on on-shoring and supply chain resilience, the report said.
At least to date, this has led to a slowdown rather than a reversal of globalization. However, the risk of a reversal is clear.
Globalization has been a powerful force in reducing income inequality across countries but, to ensure that it continues to do so, greater efforts need to be made to share its benefits more equally within countries, it noted.
Meanwhile, the report rejects the view that economic growth and environmental sustainability are incompatible – many countries have been able to ‘de-couple’ economic growth from carbon emissions, so there is no practical reason why this should not be achievable for the global economy as a whole.
But achieving sustainable growth requires economic sacrifices and a globally coordinated response, both of which will be politically difficult to achieve. This risk is especially relevant to the long-term economic outlook of low-income economies with geographies that are especially exposed to climate change.
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Posted on: 2022-12-08T09:42:46+05:00