While the U.S. and U.K. struggle to find their economic footing in the middle of a periods of economic turmoil, several other countries with emerging and developing economies are experiencing high levels of growth due to factors such as population increases, a steady rise in the demand for energy, and reconstruction and development requirements. Here are the top six as of October 2010. (Learn the underlying theories behind these concepts and what they can mean for your portfolio. See The Importance Of Inflation And GDP.)
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After the 9/11 terrorist attacks in the U.S. in 2001, international focus turned to the South Asian country that was controlled by the Taliban. Once the extremist group was rooted out, Afghanistan began to experience economic improvements. From 2003 to 2007, the country had growth rates exceeding 10%. The economic downturn reduced growth to 3.4% in 2008. World leaders have pledged billions of dollars to help Afghanistan which still remains poor, despite accelerated gross domestic product (GDP) growth in 2009 of more than 22%. A recent U.S. discovery of $1 trillion in untapped mineral deposits such as iron, copper and cobalt looks to be a promising boost to Afghanistan's economic growth and stability.
Success in the oil exports, construction, banking and real estate sectors led to major growth for Azerbaijan from 2006 to 2008. Although the economic slowdown for 2008 affected Azerbaijan, its growth still remained above 9% in 2009. The country is ranked No.3 in the world for GDP real growth rate. Azerbaijan has a low unemployment rate for the region at 6%, down from 7% in 2008. The continued economic growth in Azerbaijan hinges on increased foreign investments and an end to its conflict with Armenia. (Learn what the GNP truly represents, and how its misuse can manipulate the facts. Read Don't Be Misled By Gross National Product.)
The East Asian country with a land mass nearly as large as the United States has seen exponential growth since it turned it focus to market-oriented economic development in the late '70s. Industries such as mining and ore processing, iron and steel, and personal and business services comprise more than 89% of the country's GDP. China is a lower middle-income country in per capita terms, but ranked as the second-largest economy in the world after the U.S. on a purchasing power parity (PPP) basis that adjusts for price differences. (L4) China is also the top holder of U.S. Treasuries with $868.4 billion in assets.
- Republic of Congo
Oil is the heart of the economy in the Republic of Congo. The western Africa nation has seen a steady increase in its GDP rate as it skyrocketed from -1.6% in 2007 to 7.6% in 2009. It has one of the highest growth rates in Africa, coming in second after Ethiopia. Some experts predict that 2010 to 2020 will be a decade of growth and change in Africa due to better governance, better mobile technology and improved infrastructure funded by China.
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Following a tumultuous economy in the 1980s and 1990s, Qatar has emerged as the country with the second-highest per capita income in the world. Oil and natural gas revenues sustain the Middle East country and account for more than 50% of GDP, roughly 85% of export earnings, and 70% of government revenues. In an effort to diversify the country's economy the government is dedicated to increasing private and foreign investment in non-energy sectors. The economic crisis slowed Qatar's economic climb only slightly with growth at 9.5% in 2009.
Being cut off from the rest of the world might seem like a bad thing, but it has been a benefit to the remote, land-locked Uzbekistan. The economic crisis has not had a major impact on the central Asian country due to its distance from global financial markets. Hydrocarbons, natural gas and petroleum exports keep it competitive in the energy market. However, gold and cotton also play a large role in the country's economy. Despite strict currency controls and tight borders, Uzbekistan managed to rank No.6 in the world with an 8.1% GDP real growth rate in 2009.
The Bottom Line
As the world's top powers attempt to recover from the economic downturn, many developing nations look towards the possibility of future expansion and growth. (GDP is the typical indicator used to measure a country's economic health. Find out what it fails to reveal and how the Genuine Progress Indicator can help. Refer to High GDP Means Economic Prosperity, Or Does It?)
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