Globalization: Small Countries are Gaining

(06 July 2021) Globalization — the reduction of barriers to international trade and cross border capital and labor flows — has been a major driver for the global economy in the past few decades. The rise of the global economic model has undeniably provided benefits, but the degree of success differs across countries. To measure how different countries have fared in the more economically open world, we compared the ratios of countries' per capita GDP to the US per capita GDP in 1990 and 2019. The change in the ratio over the last 30 years reflects how countries improved or lost their position in the global economy.

• The cross-country comparison shows that small non-energy-exporting countries in Europe and Asia — like Macao (special administrative region of China), Ireland, Luxembourg, Singapore, and South Korea — were the most successful in the global competition.
• On the other hand, the relative economic strength of oil- and gas-exporting countries like UAE, Saudi Arabia, Oman, and Bahrain deteriorated the most.
• The US's major geopolitical rivals, China and Russia, achieved more GDP per capita growth than the US, while large western European economies held relatively steady in comparison with the US.
• With a few exceptions, the relative economic power of most countries in Africa and the Americas either deteriorated, as in Brazil, South Africa, and Algeria, or held steady.