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New purchasing power parities show low- and middle-income economies account for half of the global economy: World Bank

New purchasing power parities show low- and middle-income economies account for half of the global economy: World Bank

India Blooms News Service | @indiablooms | 20 May 2020, 05:01 am

Washington/IBNS: New purchasing power parities (PPPs) for reference year 2017 that adjust for differences in the cost of living across economies were released today by the International Comparison Program (ICP).

According to the report Purchasing Power Parities and the Size of World Economies: Results from the 2017 International Comparison Program, the size of the global economy was nearly $120 trillion in 2017 measured by the new PPPs, and over half of total economic activity was in low- and middle-income economies, read the World Bank website.

High-income economies, where 17 percent of the global population lives, accounted for 49 percent of global PPP-based gross domestic product (GDP).

Upper and lower middle-income economies, home to 36 percent and 40 percent of the global population, contributed 34 percent and 16 percent respectively.

The share of global PPP-based GDP for low-income economies, with 8 percent of the global population, was less than 1 percent. The two largest economies were China and the United States, each recording a PPP-based GDP of just under $20 trillion in 2017. Together they accounted for one-third of the global economy.

“The strong partnership of countries, regional agencies and international organizations is what makes the ICP possible,” said Mari Pangestu, Managing Director for Development Policy & Partnerships, The World Bank. “The new data will help to improve our collective understanding of the global economy, serving as a crucial benchmark from which to measure the economic impact on economies across the globe as we work to achieve better development outcomes.”

By collecting price data for many goods and services, together with total spending on them, the ICP produces PPPs which make it possible to compare the relative sizes of economies and the per capita income and consumption of their people, controlling for price level differences across countries. Price level indexes and estimates of PPP-based GDP and expenditure components such as consumption and investment are also released.

The ICP is one of the world’s largest statistical initiatives, coordinated by the World Bank under the auspices of the United Nations Statistical Commission. ICP 2017 marks the ninth comparison completed since the initiative was launched over 50 years ago, covering 176 participating economies for reference year 2017.

“In these difficult months, as we face a global pandemic, it is hard to focus on anything else. Yet measurement remains important, perhaps even more so, especially for these global measures from one of the world’s largest international statistical collaborations. As the world recovers, these new numbers will provide an essential benchmark for charting our progress.” said Nobel Laureate Sir Angus Deaton, Chair, ICP Technical Advisory Group.

According to the ICP 2017, ten economies had a PPP-based GDP per capita above $60,000, with 0.5 percent of the population worldwide. Among income groups, PPP-based GDP per capita ranged from one-tenth of the world average for low-income economies to three times the average for high-income economies. The ICP 2017 also compares per capita consumption and finds that the United States had the highest level at $44,620.

Cross-country inequality persisted, with around three-quarters of the world’s population living in countries where the per capita income and consumption were below their respective global averages of $16,596 and $10,858.

“The ICP  provides governments with indicators critical for assessing their competitiveness in the global economy and helps them strengthen their statistical capacity and institutional knowledge through a meaningful global partnership,” said ICP Governing Board Co-Chairs, Pravin Srivastava, Chief Statistician of India, and Werner Holzner, Director General–Statistics, Statistics Austria.

Going forward, the ICP will continue to evolve and adapt to a changing economy, not only in what people buy but in which outlets and platforms they make their purchases. Country participation will be expanded to leave no one behind, especially countries that are affected by fragility and conflict.

The ICP 2017 results are available through the ICP website and the World Bank’s Databank. Users can apply for access to more granular unpublished results and underlying data as set out in the ICP Data Access and Archive Policy. Revised results for 2011, the previous ICP reference year, were also released as well as estimates of annual PPPs for the period 2012-2016. The next ICP comparison will be conducted for reference year 2021.

PPPs are statistical estimates and should be treated as approximations to true values, subject to sampling, measurement and classification errors. PPPs should not be used as indicators of the under- or overvaluation of currencies.

ICP implementation was coordinated by the ICP Global Office at the World Bank, in partnership with the African Development Bank, the Asian Development Bank, the Interstate Statistical Committee of the Commonwealth of Independent States, the United Nations Economic Commission for Latin America and the Caribbean, the United Nations Economic and Social Commission for Western Asia, the Statistical Office of the European Union and the Organisation for Economic Co-operation and Development. Global coordination, methodology development, and governance activities were financed by the UK’s Department for International Development, the International Monetary Fund and the World Bank.

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Erdogan's Turkey turns Hagia Sophia into a mosque again; UNESCO regrets #HagiaSophia, #Turkey, #Istanbul, #HagiaSophiaMosqueAgain Istanbul/IBNS: Hagia Sophia, Turkey's iconic monument, a UNESCO World Heritage and one of the central attractions of its capital Istanbul, is no longer a museum. It has been turned back as a mosque though some 1500 years ago it was built as an Orthodox Christian cathedral. Hagia Sophia was converted into a mosque during the Ottoman time in 1453 while under Ataturk it was turned into a museum in 1935. The decision comes amid a growing rise of the Islamists in Turkey who had been demanding that it be restored as a mosque though Opposition leaders with secular credentials had been against the move. A top court in Turkey ruled that turning it into a museum in 1935 by modern Turkey's secular architect Mustafa Kemal Ataturk was illegal, paving the way for present Turkey president Recep Tayyip Erdogan to declare it as a mosque again and to open it for Muslim prayers. Erdogan made the announcement an hour after the court ruled the conversion to museum in 1935 as illegal and scrapped its status. "May it be beneficial," posted Erdogan on Twitter, sharing an official document on the change with his signature. UNESCO regrets In an immediate reaction, UNESCO said it "deeply regrets" the decision. UNESCO said it was "regrettable that the Turkish decision was not the subject of dialog nor notification beforehand". "UNESCO calls on the Turkish authorities to open a dialog without delay in order to avoid a step back from the universal value of this exceptional heritage whose preservation will be reviewed by the World Heritage Committee in its next session," the United Nation's cultural body said in a statement. Istanbul icon of beauty and wonderment According to Turkey's official tourism website, Hagia Sophia is a remarkable achievement in the history of architecture. and a living proof of mankind's revolt against the laws of physics and it calls it a monument whose importance transcends borders. It is one of UNESCO's World Cultural Heritage sites attracting millions of visitors across the world with its majestic grandeur

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Erdogan's Turkey turns Hagia Sophia into a mosque again 11 Jul 2020, 01:37 pm