Since the most recent global economic crisis beginning in late 2008, everyday
people have become more involved and eager to learn about the state of their
country's economy.
When things like jobs and personal finances are at stake, it’s only natural for
people to become more interested in economics and economic policy. In countries
where economic policy and performance are lagging behind similar nations,
citizens tend to be more if not overly concerned with the decisions and actions
of economic policy makers.
It appears that some countries are in a much better financial situation than
others and in turn, should worry less about money than countries with less
attractive financial figures. When measuring the health of a country’s economy,
the most important indicator is the Gross Domestic
Product (GDP) per capita. The GDP per capita is the amount of wealth a country
produces in one year, divided by the number of habitants. Though wage inequality
needs to be kept in mind as well as other issues in regard to prices, GDP per
capita still stands as the best way of assessing a country's economic
performance. It also serves as a great benchmarking tool when it comes to
comparing the economic performance of different countries.
Annualized GDP Growth from 1990 to 2007
If you want to know which countries are the global financial leaders and
which countries have the best standard of living, here is a list of the
countries with the highest GDP per capita.
Canada which is located just north of the United States and famous for its maple
syrup, has a lot more to offer to its citizens than just some delicious liquid
for pancakes. Canada’s income disparity
(that is, the difference between the lowest and highest wages) is very low, and
citizens enjoy a single payer healthcare system. Single payer means that
healthcare is universal and afforded to all citizens and healthcare is provided
by the national government, financed by tax revenue.
Canada's economy is mostly driven by the service sector, with three-fourths
of the employed population working in the service industry. Another important part of Canada’s economy
is the primary sector. The primary sector is defined by jobs that make direct
use of natural resources. Canada covers a large area of land that is full of natural
resources. Since these resources can be utilized either directly or as
manufactured finished goods, Canada has a high level of exports. The two main
Canadian exports
are wood and petroleum-based products.
Both of these exports are mired in controversy as environmental concerns face
both the logging and petroleum industries. Due to the globe's insatiable demand
for these types of products, Canada will likely benefit from future exports with
little to no impact from the environmental movement.
GDP per capita: $42,533.
14) Sweden GDP: $525.7 billion. Population: 9.51 million.
Sweden is officially known as the Kingdom of Sweden and despite what you may
think, IKEA furniture is not the driving force behind Sweden's economic success.
The keys to Sweden's economic success are based on the country's export
oriented, mixed economy consisting of manufactured goods, energy, and services.
Stockholm is considered to be Sweden's economic center.
The main natural resources that Sweden produces for exportation are timber
and iron ore. As far as energy exports are concerned, hydropower is what is
predominantly exported and the major player is the Swedish power company
Vattenfall.
Vattenfall Hydroelectric Power Station
Engineering specialized products, pharmaceutical products, and telecommunication technology
and services make up the rest of Sweden's mixed economy.
GDP per capita: $43,180.
13) The Netherlands GDP: $772.2 billion. Population: 16.77 million.
When talking about the Netherlands, you probably only think of the territory situated north of Germany and Belgium. This is only a portion
of what constitutes the Kingdom of the Netherlands. The Netherlands also
includes three Caribbean islands. However, when talking about the country's GDP, these
additional Dutch territories are omitted. Number 13 is only talking about the
European territory; call it Netherlands proper. The economy in the Netherlands
is mostly known for having healthy relationships with industry, moderate
unemployment rate as well as inflation, a sizable trade surplus, and as a
critical European transportation hub.
The Netherlands has a productive and
healthy fishing industry thanks to the rich coastline of the North Sea, and the
Netherlands exports all sorts of oceanic products to many other countries.
Dutch Fish Supplier Ekofish Crew and Vessel
Banking and financial services serve as another extremely important portion of
economic performance for the
Netherlands. Other key industries revolve around the development of chemicals,
metallurgy and machinery, and producing electrical goods. Despite its small
size, the Netherlands attracts many tourists each year.
Famous cities like
Amsterdam and Rotterdam draw many foreigners, and tourism serves as another very significant
portion of the Dutch economy. Famous companies like Heineken and TomTom also
call the Netherlands home, which only adds to the economic prosperity of this small country.
Ireland is the third biggest island in all of Europe, and is situated on the North Atlantic Ocean
just west of Great Britain. The
island of Ireland is actually divided into two countries. One of them is the
Republic of Ireland, which separated from the British Commonwealth in 1949 and
then joined the
European Union in 1973. The national currency for the Republic of Ireland is the Euro.
To the north lies Northern Ireland, a smaller part of the country that is still
a part of the United Kingdom. Northern Ireland is still a part of the UK and uses the pound
for its currency.
The economy of Ireland is defined as a modern knowledge economy. Ireland's
economy is heavily based on services, high-tech industries, and is largely
dependent on trade.
Ireland’s strongest industry is energy, and the Irish use peat as fuel very
similar to the way
oil is utilized. Peat is a brown, soil-like material, consisting of partly
decomposed vegetable matter. Although there are may advantages of peat over the
using of petroleum, there are only very few areas in the world where peat is
used as a local fuel.
Peat Harvesting
The other source of energy and a much more globally
relevant form of energy is renewable electricity. In 2012, renewable energy
sources like wind, hydro, and peat helped saved the country 245 million euro.
Breakdown of Irish Power Sources
GDP per capita: $43,592.
11) Austria GDP: $399.6 billion. Population: 8.46 million
The Republic of Austria is a German-speaking country situated east of
Germany. Austria enjoys a well-developed social market economy and a high
standard of living for its citizens. Labor movements are particularly strong in
Austria, and historically Germany has been Austria's most significant trading
partner. Some of the most important companies based in Austria are in the
banking sector, like Bank Austria for example.
Other economic prosperity comes
mostly from Austria's highly developed industry and international tourism.
Austria is the home of Wolfgang Amadeus Mozart as he was born in Vienna,
Austria. 9 percent of Austria's GDP
comes from tourism, placing it as the 12th ranked tourism destination in the
world.
Since Austria is highly dependent on the German economy, Austria is
unfortunately vulnerable to any sudden changes in the economic performance or
policies of Germany. Austrian citizens enjoy social welfare programs and a
two-tier health care system which covers almost all citizens with publicly
funded care.
10) Australia GDP: $1.521 trillion. Population: 22.68 million.
The Commonwealth of Australia include the giant island nation-continent, but
for GDP measuring purposes the island of Tasmania and some other smaller islands
near Indonesia will also be taken into account.
On one hand Australia may have a
global reputation for having many exotic and quite possibly deadly wildlife, but
on the other Australia is renowned for its very low
poverty level as well as high standard of living for its citizens. Maybe staring
death in the face is doing something for Australia's economic performance. The
Australian economy has experienced continuous growth, features low unemployment,
contained inflation, very low public debt, and a strong and stable financial
system.
Demand for resources and energy from Asia and especially from China has grown
rapidly, which has created an opportunity for resources investments and growth
in commodity exports. While exporting and energy production are still strong
sectors, Australia is becoming less of an
economic powerhouse than it was in the past.
The real king of Australia’s income is the services industry, which accounts
for 70 percent of the total GDP. Key components of Australia's service sector
include education, financial services, and tourism.
GDP per capita: $44,598.
9) United States GDP: $15.68 trillion. Population: 313.9 million.
The United States of America needs very little in the way of an economic
background. For many years the United States has gained a reputation for being
an economic powerhouse and as the most powerful nation on the planet. U.S.
foreign political and diplomatic relations vastly shadows the country's economic
performance. U.S. companies enjoy greater flexibility than their Western
European and Japanese counterparts. The U.S. economy is a market-oriented
economy where private individuals and businesses make most of the economic
decisions concerning economic policy.
The U.S. has many natural resources that the country uses for its primary
sector. Despite this richness of resources, the U.S. is still the largest
importer of goods in the world and the U.S. suffers from a long-standing trade
deficit. The explosion of technology mostly explains the gradual development of
a two-tier labor market. In a two tier labor market, individuals at the bottom
lack the education and the professional or technical skills of those individuals
who make up the top tier.
This type of labor market is at the crux of most of
the income disparity facing many Americans, and the gap between the have and
have-nots continues to rise. Standard of living issues plague the U.S. due to
increasing class and income disparity, and poverty levels have steadily risen
since 1996.
The U.S. enjoys the highest exportation levels when it comes to
transportation equipment, and it’s only second in the export of other goods. The
service industry in the United States is also a key factor in the economy
especially as of late where many Americans are being forced away from
manufacturing jobs as many , which add up 67.8 percent of the U.S.'s total
GDP.
GDP per capita: $49,965.
8) Hong Kong SAR, China GDP: $263.3 billion. Population: 7.15 million.
The territory of Hong Kong is one of the two of the Special Administrative
Regions under China’s jurisdiction, and its economy is independent from the rest of China's
economy. Hong Kong is a free market economy that is highly dependent on
international trade and finance. Hong Kong is one of most densely populated areas in the world
and has no tariffs on imported goods and it applies excise duties on only four
commodities: hard alcohol, tobacco, hydrocarbon oil, and methyl alcohol.
Location of Hong Kong
Hong Kong's economic strengths include a sound banking system, virtually no
public debt, a strong legal system, ample foreign exchange reserves, and
stringent anti-corruption efforts and close ties with mainland China. Hong Kong enjoys a thriving and privileged
position as an international financial center.
As Hong
Kong is a busy shipping port, the main source of income for the country comes
from re-exporting; that is, importing goods from nearby countries like China and
then exporting them to other countries.
Port of Hong Kong
Essentially, Hong Kong works as a
distributor from mainland Asia to the rest of the world.
GDP per capita: $51,946.
7) Brunei Darussalam GDP: $16.95 billion. Population: 412,200 habitants.
Brunei Darussalam, or as it is officially known, Nation of Brunei, the Abode
of Peace (yes, that is the official name of the country), is a sovereign state
located on the island of Borneo. Brunei as a small well-to-do economy that
depends on revenue from natural resource extraction but also includes a mix of
foreign and domestic entrepreneurship, government regulation, welfare measures,
and village tradition.
Almost all of the nation’s GDP, up to an astonishing 90 percent, comes from
the extraction of crude oil and natural gas. Brunei has the fortune of having so
much of both natural resources in such vast quantities that it is the fourth
largest producer of oil in South-East Asia, as well as the ninth largest
exporter of liquefied natural gas in the world.
Shell Oil's Champion West, Brunei
Brunei enjoys one of the highest GDPs in all of Asia thanks to substantial
income from overseas investment which help to supplement income necessary for
domestic production. Thanks to these investments and energy resources, they
can make up for the lack of basic resources like food, which they have to
import. Brunei Darussalam is currently trying to fix this lack by introducing
plantations that can produce more food and investing in agricultural
research.
The official name of Switzerland is the Swiss Confederation. This country
sits smack in the middle of western and central Europe, sharing frontiers with
Germany and several other countries. Switzerland's economy benefits from a
highly developed service sector led primarily by financial services, and a
manufacturing industry specializing in high-technology, knowledge-based
production. Even though
it’s a country with a small sovereign territory, it has two important cities that are
considered major global economic capitals: Geneva and Zurich.
Switzerland also is host to many important international companies, like
Nestlé, Novartis, and Adecco, and it’s the 20th ranked country in terms of the
exportation of goods.
Those goods are mainly high-tech commodities or manufactured goods that
require a very skilled and complicated manufacturing process. A few examples of
these are the chemicals used for health and medication products, precision
measuring instruments, music instruments, pharmaceuticals, and of
course, watches.
Switzerland's economic and political stability, transparent and legal system
free of corruption, efficient capital markets, low corporate income tax rates,
and amazing infrastructure make Switzerland one of the most competitive
economies on the planet.
The Republic of Singapore is a city state, and it is the only one in the
world that is also an island. Singapore has a highly developed and successful
free-market economy. It flourishes from an amazingly open and corruption-free
economic environment, stable prices, and a per capita GDP that is higher than
most developed countries.
Singapore’s economy depends heavily on exports, specifically consumer
electronics, information technology products, pharmaceuticals, and on its
growing financial services sector. Long-term economic goals for the government
are based on hopes to establish a new economic growth channel focusing on
raising the nation's productivity.
The main economic force that drives Singapore forward is the trade industry.
Singapore, despite its small size, is ranked number 14th in the list of
exporting countries. When you pair up this data with the fact that it has really
low taxes, it’s understandable that it would attract plenty of foreign
investment.
Global Distribution of Singaporean Exports in 2006 as a Percentage of the top
market (Malaysia)
By Anwar saadat via
Wikimedia Commons
Singapore, based on its amazing performance for a developing nation, has
attracted major foreign investments in both pharmaceutical and medical
technology production. The pharmaceutical and medical technology production
industries will continue to make Singapore Asia's financial and high-tech center
for many years to come.
The Kingdom of Norway has one of the lowest population densities in Europe,
second only to Finland. Norway’s economy is a prosperous mixed economy, complete
with a viable private sector, a large state sector, and a comprehensive social
safety net with a heavy emphasis on welfare programs.
Thirty percent of Norway’s
workforce is hired directly by the government, which is drastically higher
percentage compared to similarly structured countries. One effect of that is that the level of income
inequality is kept under check, and income inequality and disparity in Norway is
one of the lowest in the world.
Norway is empowered with extensive natural resources including petroleum,
hydropower, fish, forests, and minerals. Norway is highly dependent on the
petroleum sector, which accounts for most of Norway's export revenue and
approximately 30% of total government revenue. Norway is able to
exploit its large forests for timber and mountains for valuable minerals and
natural gas.
Oil Platform Statfjord A
Norway has one of the most progressive plans as far as petroleum
and natural gas production are concerned. In anticipation of eventual declines
in oil and gas production, Norway saves state money from the oil and gas sector
that make up the world's largest sovereign investment fund (valued at $830
billion) and uses the investment returns to help finance public expenses.
GDP per capita: $65,640.
3) Qatar GDP: $171.5 billion USD. Population: 1.86 million
The State of Qatar was formerly just a small country of fishermen and pearl
hunters. However, after the discovery of oil, the economy changed completely,
and Qatar became a rich country with very high standards of living, which are
further enhanced by the lack of income taxes. Qatar's GDP is mostly driven by
changes in oil prices and by investment into the energy sector.
Traditional Dhows (boats) and West Bay Skyline, Doha, Qatar
By StellarD
via Wikimedia Commons
Economic policy is primarily focused on developing the country's natural gas
reserves that are not already associated with the government and increasing
private and foreign direct investment into non-energy sectors. Still oil and gas
still account for more than 50% of Qatar's GDP. The unemployment in Qatar is the
lowest in the world, with only 0.1 percent unemployed. That’s one out of every thousand
people who are of working age. Interestingly though, 94 percent of Qatar’s
workforce is formed by immigrants.
Still, as many as 14 percent
of the native households have a millionaire-level income (yes in U.S. dollars). All these impressive numbers
and opulence are all thanks to the massive exportation of oil and natural gas,
and Qatar
is the leading country in the exporting of liquid natural gas.
GDP per capita: $83,460.
2) Macau SAR, China GDP: $43.58 billion. Population: 556,800.
Macau is the other Special Administrative Region of China, with Hong
Kong being the other one mentioned in this list. Since opening its locally
administered casino industry to foreign rivals in 2001, Macau has since
attracted tens of billions of dollars in foreign investment and has transformed
the territory into one of the world's largest gaming centers.
Much of Macau's
success is thanks to China's decision to relax standing travel restrictions on
Chinese nationals who may hope to visit Macau. Macau's gaming-related taxes made
up more than 85% of total government revenue.
Macau’s manufacturing sector has drastically slowed greatly since the
termination of the Multi-Fiber Agreement in 2005 that was seen as the beginning
of the end of its textile industry. Since 2013, Macau's economy is becoming more
and more dependent on its dominating gaming industry.
Challenges facing Macau's
gaming industry include money-laundering for mainland China and a need for
further economic diversification away from the country's general dependence on
gaming revenues.
The Grand Duchy of Luxembourg is a very small country squished between Germany
and Belgium. Luxembourg enjoys a small, stable, and very high-income economy.
Luxembourg benefits from its proximity to France, Germany, and Belgium.
Luxembourg has historically featured solid growth, low inflation, and low
unemployment. The country's industrial sector, which was first dominated by
steel production, has grown to diversify into chemical, rubber, automobile
components, and many other manufactured products.
In the service industry department, Luxembourg works with financial services
and banking, which recently has been taking a more important role. Public debt
in
Luxembourg, even with its large dependence on banking during a recession, has
remained among the lowest in the region.
Industrial and Commercial Bank of China, Luxembourg
Also even in the face of the global
financial crisis and recovery, Luxembourg retained the highest current account
surplus as a share of GDP in the euro zone, owing much of their success to their
strong financial services sector.
GDP per capita: $91,388.
Conclusion
Though these numbers may change a little from year to year, the fluctuations of
rank as far as GDP per capita are always between the same couple of countries.
Smaller countries with a high focus on services, banking, and communications
easily stay on the top, along with countries with large energy resources. The
presence of a wealth of natural resources can make or break a nation's economy.
Natural resources can both boost domestic manufacturing efforts and be a
resource for exportation - both of which will increase a country's GDP.
Countries with low taxes and a robust welfare system also have a high standard
of living, and their citizens can look forward to years and years of future
economic prosperity.
References:
Wikipedia: general information on the country’s main
industries and economic information
www.worldbank.org : list of GDP per capita by country, data
actualized to 2013.
www.un.org/Depts/unsd : definition of GDP and reason why it has been
used as basis to measure the ranking of economic wellbeing. 9) USA
National Poverty Center statistics from February 2012 (the level of
poverty has doubled from 1996 to 2011)
//npc.umich.edu/
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