9 countries that are set to get poorer very soon
Tougher times ahead?
Risky government decisions, a potential global trade war, and a dependency on natural resources are just some of the reasons why some countries are set to experience a nosedive in their wealth. Using the FocusEconomics Consensus Forecast for nominal GDP per capita, we look at the countries it predicts are set to get poorer over the next four years and why.
gorillaimages/Shutterstock
Switzerland
While Switzerland is currently the 2nd richest country in the world, it is set to fall down the rankings, slipping to fifth richest by 2022.
Switzerland
Why? Economic uncertainty has been caused by a massive overhaul of the Swiss corporate tax system, which saw the population vote against proposed solutions, after the EU called on the country to change its ‘harmful’ tax practices.
Switzerland
Financial instability has also been blamed for an ongoing debate on pension funds, as the welfare system struggles to deal with an ever-increasing population. Along with the weakening of the Swiss Franc, and the EU constraints on the Swiss National Bank, the country is going to have to work hard to solve these issues if it wants to regain its place as one of the wealthiest countries in the world.
oneinchpunch/Shutterstock
USA
Despite a mostly recovered stock market, the US is predicted to drop from being the 6th to the 8th richest country in the world by 2022, based on its GDP per capita. President Trump’s plan to grow the US economy at a rate of knots has some economists predicting a boom and bust situation, which could see the country back in recession by 2020.
USA
President Trump’s defiant trade agenda, with tariffs imposed on steel and aluminium imports, is predicted to backfire on the US economy long term, causing financial damage and job losses.
USA
One such casualty is US company Harley Davidson, which has announced it's moving some production out of America due to the recent EU retaliatory tariffs on US motorcycles. The EU tariffs were a response to the US duties on steel and aluminium imports.
South Korea
South Korea has long been a high-tech, service-based economy which thrives on its exports, namely cars and technology, with Samsung, Hyundai and Kia being just some of Korea’s most successful exporters. In fact, more than 40% of the country’s GDP comes from its exports, and this reliance is set to harm the economy.
Prasit Rodphan/Shutterstock
South Korea
In April of this year, South Korean exports were shown to be in decline because of falling global demand. As a result, this is causing a downturn in its manufacturing sector.
ESB Professional/Shutterstock
South Korea
What's more, the ping-pong trade situation between China and the US is set to damage South Korea’s economy and further weaken its exports. Youth unemployment and rising house prices also on the list of problems and the next four years will see the country drop two places in the GDP world rankings, according to FocusEconomics, from 26th to 28th richest.
Saudi Arabia
Saudi Arabia possesses about 16% of the world's proven petroleum reserves, which accounts for a mammoth 42% of its own GDP. However, an international oil cap deal has seen a reduction in oil output that will continue to put a strain on the country’s economy.
Saudi Arabia
An ongoing effort to crackdown on mass corruption has also reported to have unsettled the economic landscape. By 2022, the kingdom is due to fall from 38th to 41st in the world rankings of richest countries.
Oman
Oman has long been reliant on its oil industry but this is in steep decline, with some predicting its oil reserves will dry up in as little as 45 years from now.
Oman
The country is focussing on diversification, but the objective of reducing the oil sector’s contribution to GDP from 46% in 2017 down to 9% by 2020 is an ambitious one. Coupled with the country's high unemployment rates, Oman is looking at challenging times ahead, dropping from 44th down to 50th richest country by 2022.
Russia
The falling price of crude oil and the weakening of the Russian Rouble have been at the centre of Russia’s economic problems in the last few years and its impact continues to threaten the country’s financial stability.
Russia
Western sanctions in response to Moscow’s annexation of Crimea and its involvement in Ukraine have limited international funding for Russian companies and isolated the country from some of the world's biggest economies.
Tatiana Bobkova/Shutterstock
Russia
Low wages and a high poverty rate look also look set to continue. By 2022, Russia is predicted to drop from 53rd to 56th richest country in the world.
Brazil
Brazil entered into the worst recession in its history in 2015 with GDP falling by 3.8% and it has still not recovered. Despite a large economy, with natural resources and global exports such as sugar and coffee, the country is fighting inherent political and social problems.
Brazil
Uneven distribution of wealth, a spike in criminal violence and widespread corruption are set to cause the country to become poorer, going from 58th richest country to 62nd by 2022.
BlueOrange studio/Shutterstock
South Africa
It has the largest stock exchange in Africa and an abundant supply of natural resources, but South Africa is plagued by economic troubles that are getting worse.
South Africa
A report by South Africa’s Treasury in October 2017 predicted that the gross loan debt is expected to reach $247 billion (£187bn) in 2020 as the government steps up borrowing. Internationally, South Africa’s continued political instability make it a risky country to invest in, while inequality remains widespread. FocusEconomics says it will fall from 71st richest country to 73rd by 2022.
Jordan
Unlike some of its neighbours, Jordan does not have huge amounts of natural resources to prop up its economy. Instead the country’s wealth is driven by its financial services and tourism, both of which have experienced problems in recent years.
Jordan
The refugee crisis since the the onset of the civil war in Syria has posed socioeconomic challenges for Jordan and, as of early 2016, Jordan’s own official census estimated the refugee number at 1.3 million. The country is predicted to fall from 75th richest to 77th by 2022.