US, China set to lead global economy, Asia expands its share by 2040

The world economy is projected to reach $227tn by 2040, with the United States, China and India accounting for more than half of global output as Indonesia rises among the ten largest economies.

The global economic balance is projected to shift further towards Asia over the next 14 years, with China narrowing the gap with the United States, India strengthening its position as the world’s third-largest economy and Indonesia entering the top ten. A projection based on the Centre for Economics and Business Research’s (Cebr) World Economic League Table 2026 estimates that global nominal economic output could increase from approximately $124tn in 2026 to $227tn by 2040.

The United States, China and India are expected to account for approximately 51% of the projected total, underlining the growing concentration of global economic activity among three major economies. The figures, presented by Visual Capitalist on 5 November, cover 190 economies and use current US dollar values rather than inflation-adjusted output.

The projection suggests a substantial expansion in the scale of the world economy, but it also points to a changing distribution of economic power. Asia’s share is expected to increase while Europe’s relative contribution declines, with implications for global trade, investment, manufacturing and financial markets.

The United States is projected to remain the world’s largest economy in 2040, with nominal GDP of approximately $52.9tn, compared with China’s $47.9tn. The gap would narrow to around $5tn, from approximately $10.7tn in 2026.

China’s share of global output is forecast to rise from around 17% in 2026 to 21.1% in 2040. The US share, meanwhile, is projected to decline from approximately 26% to 23.3%.

These estimates indicate a relative convergence rather than an outright change in the ranking. The United States is still expected to retain the leading position in nominal dollar terms, while China’s economic weight continues to increase.

The distinction between nominal GDP and purchasing power parity is important. Nominal GDP converts economic output into a common currency using market exchange rates, whereas purchasing power parity adjusts for differences in domestic prices. China already ranks as the world’s largest economy by purchasing power parity, according to the IMF data cited in the Visual Capitalist analysis. The 2040 ranking discussed here uses nominal GDP and should not be interpreted as a purchasing-power comparison.

India is projected to move from fourth place in 2026 to third in 2040, with its economy expanding from approximately $4.5tn to $14.1tn. The projected figure would exceed the combined output of Germany and Japan in the same year.

The expansion would strengthen India’s position in global manufacturing, services and investment. Cebr identifies the diversification of international supply chains away from China as a potential opportunity for India, citing Apple’s expansion of production there as an example.

Indonesia is projected to make an even larger move in the rankings, rising from 17th place in 2026 to eighth in 2040. Its economy is forecast to reach approximately $4.2tn, overtaking Italy’s projected $3.8tn and moving into the world’s ten largest economies.

The projections point to the growing importance of Southeast Asia within the global economy. Indonesia’s rise would increase the region’s weight in international production, consumption and investment, although the forecast does not establish how evenly economic gains will be distributed across its population.

The shift towards Asia is also reflected in the regional distribution of global output. Asia’s share of the world economy is projected to increase from approximately 32% in 2026 to 39% by 2040.

Europe’s share is forecast to decline from 26% to 21%, while North America’s contribution is projected to fall from 30% to 27%.

A declining share does not necessarily mean that a region’s economy will contract. Europe’s projected output is expected to grow, but at a pace that leaves it accounting for a smaller proportion of an expanding global economy.

Germany is projected to fall from third to fourth place, while Japan is expected to move from fifth to sixth. The United Kingdom is forecast to overtake Japan, reaching approximately $6.8tn by 2040, compared with Japan’s $5.9tn.

France is projected to rank seventh, with nominal GDP of approximately $5.2tn. Indonesia would rank eighth, followed by Brazil and Canada.

The changing economic rankings could influence where businesses direct investment, how multinational companies organise production and which markets attract greater attention from international investors.

A larger Asian share of global output could strengthen the region’s importance as a destination for consumer goods, infrastructure, technology and financial services. India’s projected expansion and Indonesia’s rise could also encourage businesses to diversify production and supply chains across a wider range of Asian economies.

However, the projections should not be treated as guaranteed outcomes. They depend on assumptions about economic growth, productivity, inflation, exchange rates and the wider policy environment. Because the figures are expressed in current US dollars, changes in price levels and currency values can affect the projected rankings independently of real increases in production.

The distinction is particularly relevant when comparing economies with different inflation and exchange-rate trajectories. A country can increase its nominal GDP without achieving an equivalent rise in real output or household purchasing power.

The figures also say little on their own about income distribution, employment quality, public services or living standards. A larger national economy does not automatically translate into higher prosperity for every household.

The Cebr projections suggest that the global economy will become more concentrated in three major economies while Asia expands its overall share. The United States is expected to retain its position at the top, but China’s continued expansion and the rise of India and Indonesia point to a more influential Asian economic landscape.

For governments and businesses, the central challenge will be to adapt to a world in which economic opportunities and competitive pressures are increasingly distributed across several major markets. The 2040 rankings offer a useful framework for considering that shift, but the actual outcome will depend on policy choices, productivity, investment and the capacity of economies to sustain growth.

Sources: Visual Capitalist, “The World Economy in 2040, in One Chart”, published 5 November 2026, based on the Centre for Economics and Business Research’s World Economic League Table 2026; Centre for Economics and Business Research, World Economic League Table 2026; and International Monetary Fund data on GDP measured at purchasing power parity.