Ranking of countries

based on PPP

Haresh Kumar

131323

What is PPP?

The purchasing power parity measures the purchasing power of one currency
against another after taking into account their exchange rate.

Exchange rate means you measure the strength of purchasing power on $1 with that of
Rs50 (suppose) and not with Rs1.

Ex: A bag in America costs $40, while in India they sell for Rs750.

Since $1=Rs50, the bag which costs only $15 if we buy in India.

Clearly there is an advantage of buying the bag in India, so consumers would be

happier to buy the bag in India.

Top 5 and bottom 5 countries

FACTORS AFFECTING GDP IN US

GDP: $15.6 trillion

The availability of land compared to most other developed countries, thus keeping the
price of both real estate and natural resources lower in the US than in those countries.

A well-developed infrastructure, high productivity, technological development,

abundant natural resources, Foreign investors.

Consumption

Leader in scientific research and technological innovation

They have the highest average household and employee income among OECD nations.

In its market oriented economy, companies have flexibility to expand capital and
develop new products. US GDP constitutes 22 per cent of the gross world product and
is the largest importer and second largest exporter of goods.

FACTORS AFFECTING GDP IN CHINA

GDP: $12.4 trillion

World's largest exporter of goods.

High productivity, low labour costs and good infrastructure have backed its position as
a global leader in manufacturing.

In terms of total revenues, three of the world's top ten most valuable companies are
from China.

The number of US dollar billionaires in China has increased from 130 in 2009 to 251 in
2012, making China the home to world's second-highest number of billionaires.

China is one of the world's top exporters and is attracting record amounts of foreign
investment.

China is the world's largest car market and the biggest energy consumer. Having
transformed itself from impoverished communist state to economic superpower,
China overtook germany four years ago

FACTOR EFFECTING GDP IN INDIA

GDP : $4.8 trillion

India has the world's tenth-largest by nominal GDP and third-largest by

purchasing power parity (PPP).

Indias biggest asset is its 487.6-million worker labour force, the world's
second-largest, as of 2011.

Government and Indian government market.

Young Population And Corresponding Low Dependency Ratio, Healthy

Savings And Investment Rates, And Increasing Integration Into The Global
Economy, The Outlook For India's Medium-term Growth Is Positive.

FACTOR EFFECTING GDP IN JAPAN

GDP :$4.5trillion.

It has some of the largest and technologically advanced producers of motor

vehicles and electronics goods, besides machine tools, steel and
nonferrous metals, ships, chemical substances, textile manufacturing
companies.

With a highly developed industrial base, it is also the world's fourth-largest

exporter and fourth-largest importer of goods.

Government debt and government spending.

The GDP per Capita, in Japan, when adjusted by Purchasing Power Parity is
equivalent to 143 percent of the world's average.

FACTOR EFFECTING GDP IN COMOROS

From 1980 until 2012, Comoros GDP per capita PPP averaged 1189.8 USD
reaching an all time high of 1353.1 USD in December of 1984 and a record low
of 1054.8 USD in December of 2011.

The total population in Comoros was last recorded at 0.7 million people in
2012 from 0.2 million in 1960, changing 279 percent during the last 50 years.

Unemployment Rate in Comoros decreased to 13.50 percent in December of

2004 from 20 percent in December of 1996.

From 2003 until 2012, Comoros Government Budget averaged -1.6 Percent of
GDP reaching an all time high of 3.1 Percent of GDP in December of 2012 and a
record low of -3.8 Percent of GDP in December of 2003

FACTOR EFFECTING GDP IN PALAUS

Tourism is Palaus main industry .

Visitors come from Japan, USA, Taiwan.

Arrivals from Asia dropped , which made Palau's dollardenominated prices more expensive.

Construction is the most important industrial activity.

Several large infrastructure projects, including the rebuilding

of the bridge connecting Koror and Babeldaob Islands after
its collapse in 1996 and the construction of a highway around
the rim of Babeldaob, boosted activity at the end of 1990s.

FACTOR EFFECTING GDP IN TUVALU

Tuvalu is a lower-middle income, very small-sized economy located in

Oceania. Tuvalu has a population of 0.01 million people.

In 2012 Tuvalu's GDP was USD 0 billion. Tuvalu's GDP grew

at 1.20% in 2012. GDP per capita, in purchasing power-adjusted dollar
terms, is USD 3,338.

Tuvalu's total exports in 2005 were USD 0.00 billion while its total
imports were USD 0.03 billion.

FACTOR EFFECTING GDP IN SAO TOME AND

PRINCIPE

The GDP per Capita, in Sao Tome and Principe, when adjusted by Purchasing Power Parity is equivalent
to 7 percent of the world's average.

The total population in Sao Tome and Principe was last recorded at 0.2 million people in 2012 from 0.1
million in 1960, changing 200 percent during the last 50 years.

Unemployment Rate in Sao Tome and Principe decreased to 14 percent in December of 2012 from 16.70
percent in December of 2006.

Sao Tome and Principe recorded a trade deficit of 31.92 USD Million in the third quarter of 2012. Sao
Tome and Principe runs systemic trade deficits due its dependency on imports of food (28 percent of
total imports), fuel (14 percent) and capital equipment. The main export is cocoa (93 percent of total
exports)

Main trading partner is Portugal (12 percent of exports and 72 percent of imports).

Government debt as a percent of GDP is used by investors to measure a country ability to make future
payments on its debt, thus affecting the country borrowing costs and government bond yields