Reflecting the rising dominance of the emerging markets, the surging country of Brazil will replace Great Britain as the world’s sixth-largest economy by the end of the year, according to a forecast by the Economist Intelligence Unit (EIU).
At year-end, Brazil’s GDP is expected to hit $2.44 trillion, just a hair above the $2.43 trillion figure for the UK.
The Brazilian economy expanded by 7.5 percent last year. EOU expects its growth to cool down to 3 percent in 2011 and 3.5 percent in 2012 (but these are much stronger than the 0.7 percent expansion predicted for Britain in each of these years).
Brazil overtook Italy last year to move into seventh place.
However, the EIU also projected that India will overtake Brazil for sixth place in 2013 – but then Brazil will retake the position in 2014, when it will move ahead of France.
Robert Wood, the EIU's chief economist on Brazil, said the Latin American giant’s good fortune was based on both a soaring consumer market as well as robust trade with China which has a huge appetite for Brazilian commodities and natural resources.
It's partly the story of the lower income classes rising up in Brazil to join the middle-class and partly the sheer size of the population of nearly 200 million, Wood said, according to Britain’s Daily Telegraph newspaper.
This also links in with Brazil's emergence in terms of being dragged up by demand from China. We are in the middle of a commodity super-cycle that will last for some time but at some point the really good times Brazil is enjoying will cool off a bit.
By the year 2020, EIU predicts, Brazil’s economy will be larger than any in Europe (including powerhouse Germany) and become the fifth biggest on the planet – behind China (which will be number one), the U.S., India and Japan.
After Brazil, in order of economic size, will be Germany (sixth place), Russia, France and then U.K.