Citi Bank recently released a report on the global economy and their projections of growth potential. I was interested in their thoughts on the which regions of the world would experience the fastest – and most sustained – growth over the next 15 to 40 years. They looked at both countries and cities, and I think they’re right to do so.

So, firstly, here is their list of the 10 fastest growing country economies of the next 40 years (as per the Business Insider on 1 March 2011 by Christine Jenkins).

• #10: Egypt – YoY growth rate: 6.4%. Citi estimates GDP in 2050 at $6.0 trillion (#10 in the world). This will be driven in large part by a 68% increase in the working age population.
• #9: Sri Lanka – YoY growth rate: 6.6%
• #8: Indonesia – YoY growth rate: 6.8%. GDP in 2050: $14 trillion (#4 in the world) – this assumes that Indonesia gets the investment needed in infrastructure, resource extraction and capital formation.
• #7: Mongolia – YoY growth rate: 6.9%. Mongolia’s economy is largely based on resource extraction and is set for 14.2% GDP growth in the next five years. It has excellent saving and investment rates.
• #6: Philippines – YoY growth rate: 7.3%. This will only happen if the country increases its investment rate (currently 14.5% of GDP). The country will benefit from a growing population and large community of workers sending remittances back and gaining foreign experience.
• #5: Vietnam – YoY growth rate: 7.5%
• #4: Bangladesh – YoY growth rate: 7.5%.
• #3: Iraq – YoY growth rate: 7.7%. Over the next four decades, Iraq’s working age population should go up by 143.4% and it has abundant oil and gas resources to draw on to finance infrastructure investment.
• #2: India – YoY growth rate: 8.0%. Citi estimates GDP in 2050: $86 trillion (#1 in the world).
• #1 Nigeria – YoY growth rate: 8.5%. Citi estimates GDP in 2050: $9.5 trillion (#6 in the world). In four decades, Nigeria’s working age population should increase by 123%, and it has started to exploit its large natural resource endowments more sustainably. Its private sector has spawned companies that are expanding to other African regions, but improvements are need in healthcare to raise the low life expectancy.

Do you agree with this list from Citi, and the additional analysis from Business Insider?

I think they should also have considered:

• Angola
• Zimbabwe – this would not be a 2050 scenario, but more short term. After Mugabe goes and a new government is installed (with a possible period of unrest), Zimbabwe will have a decade long burst of redevelopment and growth, fuelled by a passionate, hard working and well educated population, with solid neighbours and significant international goodwill.
• Afghanistan – not in this decade, but if current hostilities bring an end to Taliban rule and the recent discovery of vast mineral wealth is well used, Afghanistan would grow rapidly off a low base.
• Ghana, Equatorial Guinea, Togo, Ivory Coast, Liberia – all of these countries are likely to have access to vast oil wealth. Ghana in particular is trail blazing a new era of improved governance and wealth building.
• Cuba – After Castro, close to America.
• Brazil
• Iran – if the Islamic regime is overthrown, and Iran connects into the international community.
• North Korea – very speculative, but would be coming off of a very low base – similar to Zimbabwe after Mugabe.
• Singapore

But global growth is not just about countries. Urban populations passed rural populations for the first time in 2008. Citi has identified a set of megacities that will boom in the next 15 years. This was reported in Business Insider by Mamta Badkar and Gus Lubin on Feb. 6, 2011. Although New York and Tokyo will remain the biggest cities in 2025, they are not listed among the megacities experiencing the most growth in terms of GDP, per capita GDP and/or population. Here are Citi’s predictions for fastest growing megacities:

• #12: Rio de Janeiro – GDP growth: +$206 billion; Population growth: +1 million; Per capita GDP growth: +$13,194
• #11: Guangzhou – GDP growth: +$295 b; Pop growth: +3 m; Per capita GDP growth: +$20,869
• #10: Delhi – GDP growth: +$315 b; Pop growth: +7 m; Per capita GDP growth: +$10,919
• #9: Beijing – GDP growth: +$333 b; Pop growth: +4 m; Per capita GDP growth: +$19,459
• #8: Hong Kong – GDP growth: +$186 b; Pop growth: +1 m; Per capita GDP growth: +$16,520
• #7: Moscow – GDP growth: +$225 b; Pop growth: negligible; Per capita GDP growth: +$21,429
• #6: Mumbai – GDP growth: +$385 b; Pop growth: +7 million; Per capita GDP growth: +$11,500
• #5: Buenos Aires – GDP growth: +$289 b; Pop growth: +1 m; Per capita GDP growth: +$18,866
• #4: Shanghai – GDP growth: +$459 b; Pop growth: +4 m; Per capita GDP growth: +$20,137
• #3: Mexico City – GDP growth: +$355 b; Pop growth: +3 million; Per capita GDP growth: +$14,950
• #2: Sao Paulo – GDP growth: +$394 b; Pop growth: +3 m; Per capita GDP growth: +$15,904
• #1 London – GDP growth: +$256 b; Pop growth: negligible; Per capita GDP growth: +$29,568

If you want to see which cities will be the largest in 2025, have a look at the projections made by the Population Reference Bureau.

Do you agree with Citi’s analysis? I wonder whether Lagos, Johannesburg, Luanda, Cairo, Dhaka, Dubai, Singapore and Tehran should be on the list?