Many of the world's richest countries are also the world's smallest.

Author: Luca Ventura
Project Coordinator: B Pham

What do people think when they think about the richest countries in the world? And what comes to mind when they think about the smallest nations in the world? Some would be surprised to find out that the wealthiest nations are also amongst the tiniest.

Some very small and very rich countries—like Luxembourg, Singapore, San Marino and Ireland—benefit from having sophisticated financial sectors and tax regimes that help attract foreign investments and professional talent. Others like Qatar, Brunei and Kuwait have large reserves of hydrocarbons or other lucrative natural resources.

Shimmering casinos and hordes of tourists are good for business too: Macao, Asia's gambling haven, is the second-most affluent state in the world. Bigger countries with a relatively small population like Norway and the United Arab Emirates, two other oil and gas-rich powerhouses, round up the list of the top 10 richest nations according to the figures released by the International Monetary Fund (IMF) in April 2019.

But what do we mean when we say a country is “rich,” especially in an era of growing income inequality between the rich and everyone else?  While gross domestic product (GDP) measures the value of all goods and services produced in a nation, dividing a country's GDP by the number of the full-time residents is a better way of determining how rich or poor one country's population is relative to another's. The reason why “rich” often equals “small” then becomes clear: these countries’ economies are disproportionately large compared to their comparatively small populations.

However, only when taking into account inflation rates and the cost of local goods and services can we get a more accurate picture of a nation’s average standard of living: the resulting figure is what is called purchasing power parity (PPP), which is often expressed international dollars in order to allow comparisons between different countries.

Should we automatically assume that in nations where this figure is particularly high the overall population is visibly better off than in most other places in the word? Not quite. We are dealing with averages and in any given country, structural inequality can tip the balance in favor of the already privileged.

Another question: Should we take economic prosperity at face value? The IMF has warned repeatedly that certain numbers should be taken with a grain of salt. For example, Macao, Luxembourg, Singapore, Switzerland, Ireland, and the Netherlands are all tax havens which means wealth originally generated in other countries ends up inflating their GDP because of sophisticated accounting and legal practices. More broadly, it is estimated that over 15% of global jurisdictions are tax havens and that about 40% of global foreign direct investment flows are so-called “phantom” transactions, financial investments passing through empty corporate shells with no real influence on a country’s economy and people’s financial wellbeing.

Values are expressed in current international dollars, reflecting a single year's (the current year) currency exchange rates and PPP adjustments. Data source: International Monetary Fund, World Economic Outlook Database, April 2019.


THE 10 RICHEST COUNTRIESIN THE WORLD


10. Hong Kong

Current International Dollars:  66,517 | Click To View GDP & Economic Data

A former British colony, this special administrative region of China is a gateway to the mainland and Asia’s top financial center. Ranked 4 among 190 economies in the World Bank’s Ease of Doing Business index thanks to its good infrastructure and many tax incentives, Hong Kong is an incredibly popular destination to launch a start-up, with foreigners allowed to own 100% of their businesses without any citizenship, residency or nationality requirements. As a result, the island as a whole is extremely rich although according to government statistics one in five residents lives below the poverty line. Even so, Hong Kong is the city with the largest number of ultra high-net-worth individuals in the world (over 10,000 people with a net worth of at least $30 million). 


9. Kuwait

Current International Dollars:  67,969 | Click To View GDP & Economic Data

The flat Arabian Desert covers most of Kuwait’s territory. It was only in 1938 that oil was discovered under its sands. A lot of oil: Kuwait makes up about 8% of the world’s total reserves. The oil industry accounts today for nearly one-half of the country’s GDP and over 90% of its exports. With a population of approximately 4 million almost entirely concentrated in urban areas, this small state on the northern edge of the Persian Gulf is one of the Middle East's most advanced and democratic. However, dips in oil prices in recent years have begun to worry the very rich Kuwaitis: in 2015, the government announced the first budget deficit in more than a decade. The country has since then taken steps to diversify its economy by allowing 100% foreign ownership in a number of sectors and offering various tax breaks to investors. Nevertheless, such changes take time to bear fruit. In the meantime, Kuwait's parliament passed yet another budget projecting a revenue shortfall for the current fiscal year: the fifth in a row.


8. United Arab Emirates

Current International Dollars:  70,474 | Click To View GDP & Economic Data

Agriculture, fishing and trading pearls: these used to be the economic mainstays of this Persian Gulf nation. Then oil was discovered in the 1950s and everything changed. Today, its highly cosmopolitan population enjoy considerable wealth, traditional Islamic architecture mixes with glitzy shopping centers, and workers come from all over the world lured by tax-free salaries and year-round sunshine (to the extent that only about 20% of the people living in the country are actually locally-born). The United Arab Emirates’ economy is also becoming increasingly diversified. Outside the traditionally dominant hydrocarbon sector, tourism and construction, as well as trade and finance, are major industries. Much anticipated is also the Dubai World Expo 2020, the biggest event the city has ever hosted which is expected to attract some 25 million overseas visitors.


7. Norway

Current International Dollars:  76,738 | Click To View GDP & Economic Data

Norway’s economic engine is fueled by oil. As western Europe’s top petroleum producer, the country has benefitted from rising prices after years of decline. With massive revenues pumping stimulus into the economy, the central bank governor recently decided to do the unthinkable: hike interest rates to their highest level since 2015. While the rest of Europe flirts with sub-zero rates in order to encourage investment and growth, Scandinavia’s richest nation seems to have the opposite problem: an uptick in inflation, the most glaring signal that the economy is getting stronger. On a side note, it is also important to point out that Norwegian policymakers know that with great GDP growth comes great responsibility: contrary to many other rich nations, high per capita GDP figures are truly a reflection of people’s financial wellbeing. Norway has one of the lowest income inequality gaps in the world.


6. Ireland

Current International Dollars:  82,439 | Click To View GDP & Economic Data

European Union economies are going through a rough period. Amid uncertainties tied to Brexit and trade tensions, rising oil prices and Italy’s economic woes, Eurozone officials were forced to slash their growth forecast for the 19 member countries to 1.1%. The Irish economy, however, just keeps growing: in 2019, it will expand by over 4%, consolidating its role as the fastest-growing economy of the bloc following the 2008 financial crisis. A nation of less than 5 million inhabitants, Ireland was one of the hardest hit by the global downturn. Following some politically difficult reform measures, including sharp cuts in public-sector wages and restructuring its banking sector, the island nation regained its fiscal health, boosted it employment rates and saw its per capita GDP almost double to its current levels. Do citizens feel twice as rich as 10 years ago? Probably not: Ireland is one of the world's largest corporate tax havens, with ordinary people benefitting infinitely far less than companies do. Are they better off nonetheless? Undoubtedly.


5. Brunei Darussalam

Current International Dollars:  83,777 | Click To View GDP & Economic Data

1,788 rooms, including 257 bathrooms, a banquet hall that can accommodate up to 5,000 guests, a mosque for 1,500 people, an air-conditioned stable for 200 polo ponies, 5 pools and 18 elevators: this is where Hassanal Bolkiah, the Sultan of Brunei, lives. His fortune—derived from the immense reserves of oil and natural gas of the country—is estimated at over $20 billion, 40 times that of Britain's Queen Elizabeth. Despite Bolkiah's opulence, and a per-person GDP of over $86,000, malnutrition in Brunei is commonplace. Something like 440,000 people—40% of the population—earn less than $1,000 a year. As if things were not bad enough, the sultan—whose fortune is said to increase by $147 every second—decided in April 2019 to enact death penalty by flogging and stoning for those who commit adultery and sodomy. Being one of the world's richest countries clearly does not mean being one of the most just.


4. Singapore

Current International Dollars:  103,717 | Click To View GDP & Economic Data

Singapore's economy expanded by 3.2% in 2018, a sharp slowdown compared to 2017, when it grew 3.9%. Global trade tensions can have such effects. Yet one would be hard-pressed to find any clue of this deceleration by looking at the country’s GDP per capita figures. According to the IMF, GDP per capita grew in 2017 grew to over $86,000 from the previous year, reached $89,000 in 2018, and is projected to follow this upward trend in 2019 and until at least 2024, when it is expected to jump to $99,000. How did Singapore become so rich? When Singapore became independent in 1965, one-half of its population was illiterate. With virtually no natural resources, Singapore pulled itself up by its boostraps through hard work and smart policy, becoming one of the most business-friendly places in the world. Today, Singapore is a thriving trade, manufacturing and financial hub and 97% of the adult population is adult literate.


3. Luxembourg

Current International Dollars:  108,813 | Click To View GDP & Economic Data

You can visit Luxembourg for its castles and beautiful countryside, its cultural festivals or gastronomic specialties. Or you could just set up an offshore account through one of its banks and never set foot again, as many do. It would a pity though: situated at the very heart of Europe, this nation of about 600,000 has plenty to offer, both to its tourists and its citizens. Luxembourg uses a large share of its wealth to deliver better housing, healthcare and education to its people, who by far enjoy the highest standard of living in the Eurozone. Extraordinarily, it is worth mentioning that both the global financial crisis and the pressure from the EU and OECD to reduce banking secrecy have had little impact on the economy. In 2015, the country topped the $100,000 mark in per capita GDP and never looked back ever since.


2. Macao 

Current International Dollars:  122,201

In Asia's gambling capital many are betting that Macao will climb to the first spot of the richest nation’s ranking very soon. Formerly a colony of the Portuguese Empire, since the gaming industry was liberalized in 2001 this special administrative region of the People's Republic of China has seen its wealth growing at astounding pace. With a population just over 600,000, and more than 40 casinos spread over a territory of about 30 square kilometers, this narrow peninsula just south of Hong Kong is—almost literally—a money-making machine.


1. Qatar

Current International Dollars:  134,623 | Click To View GDP & Economic Data

About $15,000 is, on average, how much each Qatari citizen has lost each year since the hydrocarbon prices started dropping in 2014. Still, the country's total GDP per person in 2019 is still projected to remain above $134,000, slightly up from last year. Qatar’s oil, gas and petrochemical reserves are so large, and its population so small—just a little over 2.6 million—that it has topped the list of world's richest nations for 20 years. This feat is even more remarkable given that Saudi Arabia and its allies imposed a blockade on Qatar in 2017.


Gross domestic product (GDP) based on purchasing-power-parity (PPP) per capita.

Values are expressed in current international dollars, to the nearest whole dollar, reflecting a single year's (2018) currency exchange rates and PPP adjustments.​


Rank

Country

GDP-PPP ($)

1 Qatar 134,623
2 Macao SAR 122,201
3 Luxembourg 108,813
4 Singapore 103,717
5 Brunei Darussalam 83,777
6 Ireland 82,439
7 Norway 76,738
8 United Arab Emirates 70,474
9 Kuwait 67,969
10 Hong Kong SAR 66,517
11 Switzerland 65,707
12 United States 64,767
13 San Marino 61,552
14 Netherlands 58,255
15 Saudi Arabia 56,817
16 Iceland 56,530
17 Taiwan Province of China 55,244
18 Sweden 54,071
19 Germany 53,854
20 Austria 53,716
21 Australia 53,559
22 Denmark 53,552
23 Bahrain 50,868
24 Canada 50,626
25 Belgium 49,480
26 Malta 48,246
27 Finland 48,006
28 France 46,978
29 United Kingdom 46,782
30 Oman 46,476
31 Japan 45,565
32 South Korea 42,985
33 Cyprus 41,836
34 Spain 41,538
35 New Zealand 41,179
36 Puerto Rico 40,796
37 Italy 40,206
38 Aruba 40,160
39 Israel 39,160
40 Czech Republic 39,088
41 Slovenia 38,634
42 Slovak Republic 37,021
43 Lithuania 36,997
44 Estonia 35,718
45 The Bahamas 34,421
46 Poland 33,747
47 Hungary 33,708
48 Portugal 33,166
49 Trinidad and Tobago 32,684
50 Malaysia 32,455
51 Seychelles 31,809
52 Latvia 31,491
53 St. Kitts and Nevis 31,095
54 Greece 30,506
55 Russia 30,284
56 Antigua and Barbuda 29,298
57 Kazakhstan 28,515
58 Romania 27,753
59 Croatia 27,580
60 Turkey 27,391
61 Panama 27,305
62 Chile 27,059
63 Mauritius 25,029
64 Bulgaria 24,485
65 Uruguay 24,052
66 Maldives 23,154
67 Equatorial Guinea 21,441
68 Mexico 21,107
69 Belarus 20,820
70 Thailand 20,474
71 Argentina 20,425
72 Turkmenistan 20,409
73 Montenegro 19,908
74 China 19,520
75 Dominican Republic 19,516
76 Gabon 19,159
77 Barbados 18,798
78 Azerbaijan 18,794
79 Botswana 18,654
80 Serbia 18,567
81 Islamic Republic of Iran 18,505
82 Costa Rica 18,183
83 Iraq 18,008
84 Grenada 17,071
85 Brazil 16,662
86 North Macedonia 16,455
87 Algeria 15,765
88 Colombia 15,576
89 Suriname 15,526
90 Palau 15,369
91 Lebanon 15,208
92 St. Lucia 15,000
93 Peru 14,892
94 Mongolia 14,270
95 Bosnia and Herzegovina 14,164
96 Albania 14,102
97 Egypt 14,028
98 Indonesia 14,019
99 Sri Lanka 13,954
100 Paraguay 13,913
101 South Africa 13,865
102 Tunisia 12,801
103 Nauru 12,433
104 St. Vincent and the Grenadines 12,431
105 Georgia 12,282
106 Kosovo 12,154
107 Libya 12,051
108 Ecuador 11,700
109  Namibia 11,369
110 Eswatini 11,089
111 Dominica 10,866
112 Armenia 10,828
113 Fiji 10,710
114 Bhutan 10,015
115 Ukraine 9,743
116 Jamaica 9,729
117 Jordan 9,651
118 Philippines 9,494
119 Morocco 9,284
120 Guyana 8,974
121 Guatemala 8,709
122 Belize 8,642
123 Lao P.D.R. 8,485
124 India 8,484
125 El Salvador 8,313
126 Uzbekistan 8,065
127 Vietnam 8,063
128 Bolivia 7,790
129 Cabo Verde 7,727
130 Moldova 7,700
131 Republic of Congo 7,119
132 Myanmar 7,029
133 Ghana 6,998
134 Angola 6,763
135 Tonga 6,496
136 Samoa 6,135
137 Nigeria 6,098
138 Pakistan 5,839
139 Timor-Leste 5,561
140 Nicaragua 5,433
141 Honduras 5,390
142 Bangladesh 4,993
143 Cambodia 4,643
144 Còte d'Ivoire 4,454
145 Tuvalu 4,275
146 Mauritania 4,201
147 Zambia 4,177
148 Sudan 4,089
149 Djibouti 3,999
150 Kyrgyz Republic 3,979
151 Cameroon 3,965
152 Kenya 3,863
153 Senegal 3,864
154 Papua New Guinea 3,789
155 Marshall Islands 3,788
156 Micronesia 3,584
157 Tajikistan 3,578
158 Tanzania 3,573
159 Lesotho 3,564
160 Sao Tomè and Prìncipe 3,441
161 Nepal 3,115
162 Vanuatu 2,932
163 The Gambia 2,903
164 Uganda 2,622
165 Zimbabwe 2,620
166 Benin 2,562
167 Ethiopia 2,517
168 Chad 2,505
169 Mali 2,474
170 Rwanda 2,444
171 Guinea 2,429
172 Yemen 2,404
173 Solomon Islands 2,297
174 Kiribati 2,134
175 Burkina Faso 2,096
176 Afghanistan 2,086
177 Guinea-Bissau 2,025
178 Haiti 1,903
179 Togo 1,820
180 Eritrea 1,718
181 Sierra Leone 1,701
182 Madagascar 1,698
183 Comoros 1,662
184 South Sudan 1,613
185 Liberia 1,413
186 Mozambique 1,331
187 Niger 1,280
188 Malawi 1,234
189 Democratic Republic of the Congo 791
190 Central African Republic 746
191 Burundi 727

Source: International Monetary Fund, World Economic Outlook April 2019.