The Global South Is Poised to Produce Most of the World's Economy by 2040

The Question

Say "the economy" and many people still picture Wall Street, the City of London, or a factory floor in Germany. For a long time that picture was accurate: a small cluster of wealthy nations in the North Atlantic and Japan dominated global output, trade, and technology. But the centre of economic gravity has been drifting for decades, and it is drifting south and east, toward the countries that once sat at the edges of the map that mattered.

China and India together are home to more than a third of humanity and are growing far faster than the mature economies of Europe and North America. Behind them stands a wider Global South — Indonesia, Nigeria, Brazil, Vietnam, and dozens more — with young populations and rising productivity. When output is measured by what money actually buys at home, emerging and developing economies already account for the larger share. The question is whether that lead becomes decisive and durable by 2040, remaking the balance of the world.

What the Evidence Shows

By purchasing-power measures, which compare what incomes can actually buy in each country, emerging and developing economies already produce a majority of global output and have for several years. On this yardstick China alone rivals or exceeds the United States, and the broader developing world has pulled clearly ahead of the advanced economies. Measured at market exchange rates, the rich world still leads — but the gap is closing every year as fast-growing economies expand and their currencies gradually strengthen.

The growth differential is the engine. For years, developing economies as a group have expanded roughly twice as fast as advanced ones, and forecasters expect that gap to persist through the 2030s. The International Monetary Fund and other bodies project that most of this decade's global growth will come from a handful of emerging giants, with India and China alone contributing a large share and countries across Africa and Southeast Asia adding more.

Demography reinforces the trend. The advanced economies are ageing and, in several cases, shrinking, while much of the Global South is young and still urbanising. A growing, better-educated workforce moving from farms into factories, services, and digital work is exactly the recipe that lifted Europe and East Asia in earlier eras. Add rapid adoption of mobile technology and, increasingly, artificial intelligence, and many developing economies are compressing decades of catch-up into years.

Why This Is Happening

Convergence is finally working at scale. Poorer countries can grow faster than rich ones by adopting existing technology, building infrastructure, and moving workers into more productive jobs. What is different now is the size of the populations doing this at once — billions of people in Asia and Africa climbing the same ladder together. The arithmetic of so many economies converging is what tips the global balance.

Demography has switched sides. The advanced world's ageing and low birth rates cap its growth, while the Global South still has hundreds of millions of young people entering work. A rising share of the world's workers, consumers, and entrepreneurs now lives in developing countries, and economic weight follows people. The centre of production moves toward where the population is growing.

Technology is leapfrogging old barriers. Mobile phones brought banking and commerce to places that never had branch banks; solar power and cheap connectivity are doing the same for energy and information. Now AI tools let smaller firms and workers in developing economies compete globally without decades of institution-building. Each leap lets these economies skip stages that once took the West generations.

What Could Happen

What Can We Do

This is a global transformation, but it reshapes careers, investments, and outlooks in ways individuals can prepare for rather than be surprised by.

Update your mental map of where growth lives. Opportunities in careers, markets, and partnerships are increasingly found in fast-growing economies, not only in traditional Western hubs. Learning about the major emerging markets — their consumers, industries, and cultures — is now basic economic literacy. The places that will drive the next decades deserve real attention.

Diversify beyond the old economic core. Portfolios, businesses, and supply chains heavily concentrated in the advanced economies miss much of where future growth will come from. Sensible exposure to emerging markets spreads both risk and opportunity. Betting entirely on yesterday's winners is its own kind of gamble.

Build skills that travel across borders. A more multipolar economy rewards people who can work across languages, cultures, and time zones. Cross-cultural fluency and adaptability are becoming as valuable as technical expertise. The most resilient careers will be the ones that are not tied to a single region's fortunes.

Support fair terms for a rebalanced world. As economic weight shifts, so should the rules of trade, finance, and global institutions. Back reforms that give rising economies a fair voice, since a stable transition benefits everyone. A rebalancing managed cooperatively is far safer than one forced through crisis.