The world in the year 2100

Our northern neighbour Indonesia has ten times Australia’s current population and this will rise by another 64 million by 2050. Their population will plateau from around 2060 and by 2100 will have decreased marginally from their 2065 peak to 313.6 million. Indonesia also has potential for productivity growth with a per capita GDP of only USD $3,500 but it’s not clear yet what is going to lift their economy nor how they are going to go about it.

Dear Old Blighty just keeps chugging along with its population steadily rising from todays 64 million to just over 75 million by 2050 and reaching 82.37 million by 2100. By this time there might be enough of them to field a decent rugby team. They’re a strong economy with per capita GDP of USD $45,600 but this is highly concentrated on London. Any glitch in London’s world financial HQ status could spell all sorts of problems in the future.

The United States will add another 100 million people by around 2070. (See my friend Joel Kotkin’s book ‘The Next 100 Million’for what this mean for the USA.). Representing a third of the world’s economy, it’s difficult to see how the USA will lose any of its economic muscle over time. With a GDP per capita of $54,630, they just need their economy to begin firing again and for US consumers to open their wallets to stimulate rapid economic recovery – not just in the US but countries that rely on it. Another friend Dr Doug McTaggart has always maintained that the health of the US consumer has a far reaching impact on world economies and I for one believe him.

Do svidaniya comrades. Russia will shrink by 15 million people by 2050 and by 2100 will have shrunk by 26 million – equivalent to shrinking by a whole Australia today. But our Russian friends only let go of communism in relatively recent times and have much further to go in modernising their economy. They have abundant natural resources and with a per capita GDP of around USD $13,000 it isn’t hard to imagine the Russians still remaining an economic and military power by the turn of the next century.

The country that records the most astonishing growth over the period to 2100 is Nigeria. The forecasts are that the current population of 182 million will rise to over 398 million by 2050 – that’s double – and by 2100 will reach 753 million – which is almost double again and more than four times their current size. Many of the African nations show enormous growth over this period but Nigeria is the stand out. They have low productivity (per capita GDP USD $3,100) and often unstable systems of government. It’s difficult to see this being even a moderately prosperous future, unless those Nigerian loan scams are actually making a lot more money than anyone thought. The whole African story is something worthy of a lot more detailed study because that continent is going to continue growing at rates which far exceed the rest of the world. Something for another day.

What’s it all mean?

The only thing that’s certain is that the world economic order we know today is going to be vastly different in the future. Demography is going to play a significant part in that but, in reality, it’s impossible to predict much of anything beyond the likely population numbers. Will countries like Nigeria follow the Chinese path to rising economic prosperity, or fall further into poverty? Who knows? There’s another metric in all this which is aging and those countries with a younger demographic may well fare better than nations that find their relatively small working population struggling to support a much larger, dependent aged cohort. For nations like Japan, which is both shrinking and aging and with no immediately obvious path to lift economic output, this isn’t a pretty scenario.

And Australia? I think Donald Horne summed it up nicely in 1964: “Australia is a lucky country run mainly by second rate people who share its luck. It lives on other people's ideas, and, although its ordinary people are adaptable, most of its leaders (in all fields) so lack curiosity about the events that surround them that they are often taken by surprise.”