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Global Development Horizons 2013: Capital For the Future

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By 2030, half the global stock of capital will reside in developing countries, compared to less than one-third today, says report. For more visit: http://www.worldbank.org/CapitalForTheFuture

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Global Development Horizons 2013: Capital For the Future

  1. 1. Capital for the Future
  2. 2. Capital for the FutureWhich countries willdrive investment in amultipolar world?
  3. 3. Capital for the FutureWill an aging worldrun out of saving tofund investment?Which countries willdrive investment in amultipolar world?
  4. 4. Capital for the FutureWill an aging worldrun out of saving tofund investment?Which countries willdrive investment in amultipolar world?How will savers andinvestors be matchedin the future?
  5. 5. Developing economies will be majorinvestors in the world economy,accounting for 60 cents of everyinvestment dollar by 2030
  6. 6. Developing economies will be majorinvestors in the world economy,accounting for 60 cents of everyinvestment dollar by 2030
  7. 7. Developing economies will be major investorsin the world economy, accounting for 60 centsof every investment dollar by 2030DevelopingHighincomeWorldinvestmentWorld GDP0204060801001200510152025302005 2010 2015 2020 2025 2030Y (USDtrillions)I (USDtrillions)Total investment in thedeveloping world will overtakehigh-income countries…
  8. 8. Developing economies will be major investorsin the world economy, accounting for 60 centsof every investment dollar by 2030DevelopingHighincomeWorldinvestmentWorld GDP0204060801001200510152025302005 2010 2015 2020 2025 2030Y (USDtrillions)I (USDtrillions)Total investment in thedeveloping world will overtakehigh-income countries…
  9. 9. Developing economies will be major investorsin the world economy, accounting for 60 centsof every investment dollar by 2030DevelopingHighincomeWorldinvestmentWorld GDP0204060801001200510152025302005 2010 2015 2020 2025 2030Y (USDtrillions)I (USDtrillions)Total investment in thedeveloping world will overtakehigh-income countries…
  10. 10. Developing economies will be major investorsin the world economy, accounting for 60 centsof every investment dollar by 2030RussianFed.BrazilIndonesiaIndiaSub-SaharanAfricaHighincome10152025303540452005 2010 2015 2020 2025 2030I/Y (%) Despite declining investmentrates, their growing size means thatglobal investment remains stableDevelopingHighincomeWorldinvestmentWorld GDP0204060801001200510152025302005 2010 2015 2020 2025 2030Y (USDtrillions)I (USDtrillions)Total investment in thedeveloping world will overtakehigh-income countries…
  11. 11. Developing economies will be major investorsin the world economy, accounting for 60 centsof every investment dollar by 2030RussianFed.BrazilIndonesiaIndiaSub-SaharanAfricaHighincome10152025303540452005 2010 2015 2020 2025 2030I/Y (%) Despite declining investmentrates, their growing size means thatglobal investment remains stableDevelopingHighincomeWorldinvestmentWorld GDP0204060801001200510152025302005 2010 2015 2020 2025 2030Y (USDtrillions)I (USDtrillions)Total investment in thedeveloping world will overtakehigh-income countries…
  12. 12. While there will undoubtedly be demographicpressures, the world will not “run out” ofsaving in the futureHICEAPLACSSA11.21.41.61.822.22.42.61950 1981 2011 2042Working/non-workingpopulationAsynchronicity in evolvingdemographic pressures…
  13. 13. While there will undoubtedly be demographicpressures, the world will not “run out” ofsaving in the futureHICEAPLACSSA11.21.41.61.822.22.42.61950 1981 2011 2042Working/non-workingpopulationAsynchronicity in evolvingdemographic pressures…
  14. 14. While there will undoubtedly be demographicpressures, the world will not “run out” ofsaving in the futureHICEAPLACSSA11.21.41.61.822.22.42.61950 1981 2011 2042Working/non-workingpopulationAsynchronicity in evolvingdemographic pressures…HighincomeEast AsiaSub-SaharanAfricaLatinAmerica1015202530354045502005 2010 2015 2020 2025 2030S/Y (%) …implies heterogeneous decline insaving rates, with only SSA buckingthe trend
  15. 15. While there will undoubtedly be demographicpressures, the world will not “run out” ofsaving in the futureHICEAPLACSSA11.21.41.61.822.22.42.61950 1981 2011 2042Working/non-workingpopulationAsynchronicity in evolvingdemographic pressures…HighincomeEast AsiaSub-SaharanAfricaLatinAmerica1015202530354045502005 2010 2015 2020 2025 2030S/Y (%) …implies heterogeneous decline insaving rates, with only SSA buckingthe trend
  16. 16. Developing countries will increasingly be the mainsavers and investors. Indeed, they will become keyplayers in the international financial arenaHighincome05101520252000 2005 2010 2015 2020 2025 2030Grosscapitalinflows($ trillions)Developing countries will becomeimportant financial intermediaries…Developing countriesAdvanced countries47%53%
  17. 17. Developing countries will increasingly be the mainsavers and investors. Indeed, they will become keyplayers in the international financial arenaHighincome05101520252000 2005 2010 2015 2020 2025 2030Grosscapitalinflows($ trillions)Developing countries will becomeimportant financial intermediaries…Developing countriesAdvanced countries47%53%
  18. 18. Developing countries will increasingly be the mainsavers and investors. Indeed, they will become keyplayers in the international financial arenaHighincome05101520252000 2005 2010 2015 2020 2025 2030Grosscapitalinflows($ trillions)…and more so, in a scenario with rapidconvergence in institutions60%40%
  19. 19. Developing countries will increasingly be the mainsavers and investors. Indeed, they will become keyplayers in the international financial arenaHighincome05101520252000 2005 2010 2015 2020 2025 2030Grosscapitalinflows($ trillions)…and more so, in a scenario with rapidconvergence in institutions60%40%
  20. 20. Developing countries will increasingly be the mainsavers and investors. Indeed, they will become keyplayers in the international financial arenaHighincome05101520252000 2005 2010 2015 2020 2025 2030Grosscapitalinflows($ trillions)…and more so, in a scenario with rapidconvergence in institutions60%40%02468101214162000 2005 2010 2015 2020 2025 2030Grosscapitalflows todevelopingcountries(% GDP)And the scenarios are conservativeHistoricalGradual convergence scenarioRapid convergence scenarioLinear (Historical)9%6%11%
  21. 21. These outcomes will only be realizedif policymakers take active steps interms of policy and institutionalreform.
  22. 22. For example, even though saving will be more equally distributed acrosscountries, within them savings may still be concentrated amongst fewricher households, unless education opportunities are given to everyoneHousehold saving rate, MexicoDemographiceffectDemographic +education effect1011121314151617182010 2015 2020 2025 2030 2035 2040 2045 2050
  23. 23. For example, even though saving will be more equally distributed acrosscountries, within them savings may still be concentrated amongst fewricher households, unless education opportunities are given to everyoneHousehold saving rate, MexicoDemographiceffectDemographic +education effect1011121314151617182010 2015 2020 2025 2030 2035 2040 2045 2050
  24. 24. www.worldbank.org/CapitalForTheFuture

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