When you observe the global market, the order may vary from time to time, but there are some of the key players who remain the same. In the top ranking, United States of America is on top since even before the last century. It has many advantages due to this position in the market and has many positive attributes which must be appreciated. In the growing economies which give a tough time in the competition Arab world is putting in a lot of effort. The main advantage they have is the abundance of oil and petroleum reserves. The importance of oil in the global market and industrialization provides a great edge in this field.
When we see the collective economies where there are more alliances, such players also include the region of Latin America and MENA region. India and China are also fast growing economies which are progressing at a really fast speed and made a huge name in the international market. The strategies which are followed by each country to be successful vary from the competitive advantage they have because the sources vary from place to place. In this article, we will study some of the leading economies, the reasons behind their success and the features which facilitate them.
Here are some of the economies which are known for their strengths worldwide.
The United States of America
The indicators which represent the success of any region are the GDP and gross world product. The main reason behind the success is the strong infrastructure of the country. The country has gained a lot of success regarding technology which is the main concern with the advancement in the world. The US is also known as an economic superpower because they hold a large portion of the global economy and support many regions. The products developed in the area go through continuous improvement phase, and each day the nature of products change because of research and development. Another plus point they have is the richness regarding natural resources. The place where they are facing a setback is the competition with China. The per capita GDP of China is $15,423 in accordance to the $57,294 of United States. Which the overall GDP in China is $21.3 trillion which is high in comparison to the $18.5 Trillion GDP of USA.
The economy of China used to be closed before 18970s. But then, they announced themselves as the exporting and manufacturing country, and since then the whole story changed. The growth which was faced annually in the Asian region is 10% which has decreased somewhat in the past few years. All these factors indicate positivity in the growth rate of the Chinese economy and place it as the second largest economy in the world. He future forecasts also show a steady increase in the growth of Chinese economy. The main reason behind the success is that they are offer products in many price ranges. Their target market is so vast that they can cater the need of any individual who comes to them with a problem. The variety of products is also really huge. From small objects to larger ones, they play a great role in the manufacturing from the start to finishing steps to make it the perfect piece possible. The leading forces such as IMF and OECD indicate a great success over the coming years in the economy of China. Even in the Purchasing power parity in which they are lacking is estimated to have an increase in the coming years.
The ranking shows that Japan is the third largest economy in the world. They are known for the high quality of the products. In the field of business, concepts of total quality management and continuous improvement were introduced by Japanese. They focus a lot on the job training. From the start of 2008, the economy is facing some downturns. The main reason behind that issues is the weak currency and subzero bond yield. Some of the growth indicators have shown an increase in the past year which shows a positive effect. All the forecasts also show a sustained growth in the future years which is good news for the Japanese Investors.
Europe comprises a huge part of the economy of the world. Many relaxations of trade provide them a large benefit. Among all the European countries, Germany is considered to be the strongest and fastest growing economies. This makes it the fourth ranking economy of the world. The main plus points in the economy of Germany are the chemical industry, vehicles, household equipment, and machinery. All these things come in the category of capital goods which require expertise. So, the labor force of Germany is really trained, and they are contributing in the fields of food security and renewable energy. Some of the challenges are highlighted these days which are causing certain problems in the German Economy. There is continues improvement in the nominal GDP of the region. The future forecasts also show the increase in the economic growth of the region.
These were some of the economies which are present at the top of the global map. Many other countries are striving to make their part in these, and they are gaining huge success. Many emerging countries are coming in front by playing their part in the global economy regarding success. In comparison to China, India is playing the strong game to compete in the market. As the growth of China has slowed down in the recent time, India is putting in a lot of efforts. Many of the forecasts on the global level indicate that it will surpass and become the fastest growing economy in the coming years.
Factors that have an Effect on the Economic Growth
First if all, you must know what the economic growth is. We say that the economy of a country is growing when the real GDP of that region increase. The percentage increase which is observed annually in the real GDP of a country is the growth which determines the success of any economic system. This also means that the goods produced in a country provide more value to the customer and their demand has increased in the market. There are some of the factors which have an influence on the economic growth of any country.
Rate of consumer spending
This is the amount that the consumers can pay for the product they are getting. This is also known as the demand for any product. If the product delivers high value to the people who are the ultimate customers, this means that the demand for the product will increase. However, the decrease in demand will occur when the value is not delivered in return for the money paid. The spending of consumers in any country are highly dependent on the income they have and consumption taking place. When the spending pattern increase, the demand side increase, and people see an increase in the economic growth. Pricing as also a high impact on the demand. If the prices are unusually high, nobody will purchase the product unless or until they can’t survive without it. Low pricing will increase the demand to a certain level. This concludes that there is a certain amount of money which is paid to satisfy the needs and wants.
The production capacity of any country has a huge impact on the growth they face in the economy. First of all, there are multiple factors which affect the production capacity of any country. For example, the Arab world is famous for the oil and petroleum reserves they have. If they will not have the infrastructure or enough manpower to carry all the operations which are necessary to make those reserves a final product that would be of no use. So, the availability of all the products and services which make the production process easier make the enough production capacity. Now the concept of job training is evolving. This is to deliver the right quality of product and add more feature in the product which is liked by the customers. The production is also known as the supply side of the market. If a right number of products are not placed on the market, all the needs and wants of the customers will not be catered efficiently, and they will switch to other providers.
The productivity and work performed by the workers in any business determine the human capital. The workforce of some countries is really skilled and educated that is the key strength driving the whole economy towards success. The main factors which indicate that the human capital is strong are the motivation, training, education level and skill level they have to carry out operations and production procedure. By having a good human capital any firm or organization can succeed. They can enhance the quality of their product and meet other work challenges in a better way.
Infrastructure of country
Every country as its own strength. Some of the countries are blessed with a strong infrastructure which benefits them in a better way according to many aspects. Infrastructure includes many things which make the country eligible to carry out the routine operations in a smooth way. Even the roads, communication system, transportation and other production capabilities make the infrastructure of any country strong. All these things reduce the cost factor and improve the production capabilities of the country. The countries which do not have a good infrastructure find it difficult to compete in the international market. There are many developing countries nowadays which are not growing in the global market because they do not have such a developed infrastructure.
Labor market strength
The wage rates which are paid by the people performing your work are really important. This should be seen by the quality and skill set of labor force you are dealing with. If they are highly educated and possess required skills to perform your work efficiently, they will charge more which will increase the overall cost of your production procedure. That increase will decrease the profit margins you earn at the end of your accounting period. The flexibility in the labor force is the most important thing to focus here. The workers who are needed by the organization can help in the expansion of the business operations they are already performing. However, if the workforce is not skilled, the company will find the growth difficult.
Now the trend is moving towards the improvement in the technology and finding renewable energy resources. These energy resources are needed because of the high prices of energy and depletion of the natural resources. By the time we are consuming more and more amount of resources, the need for energy increase. The productivity of the countries is increasing if they focus on the technology first. It has become the priority nowadays. People are becoming more conscious about the things they use, and they require change and ease.
This is the key factor because if all the sources are present in any country, but they lack the political stability, they will not succeed at the end. Good relationships with the external world are important for growth. The decrease in growth can have a great influence on the political system present in any country or region. The rate of interest, the level of government spending and fluctuation in the price of currency make a huge difference in growth.
These were the factors which make the economic growth of any region possible in the absence of all these food securities of the people living it is not possible. The confidence of the consumer should be increased to make the growth process possible as done by the regions like Latin America and MENA region. The growth in the markets of world’s leading economies is the result of endless efforts performed by the strategy makers and the competitive advantage they have in the global market.