China is projected to narrow the GDP gap with the United States, while India overtakes Germany to become the world’s third-largest economy. Indonesia is expected to displace Italy in the top 10, and Spain is projected to remain in 12th place.
The United States, China and India are expected to account for 51% of global economic output by 2040. The world economy is projected to grow from about $124 trillion in 2026 to $227 trillion in 2040, an increase of 83% in nominal terms.
The expansion is expected to shift the balance of global economic power. China is forecast to close much of the gap with the United States, while Asia accounts for a growing share of world output, according to the World Economic League Table 2026 from the Centre for Economics and Business Research (CEBR). The figures measure annual output in U.S. dollars and are not adjusted for inflation.
China is projected to narrow the GDP gap with the United States
CEBR estimates that the U.S. economy accounts for around 26% of global GDP in 2026, with output of $31.6 trillion. China accounts for about 17%, with output of $20.9 trillion.
By 2040, the gap between the world’s two largest economies is projected to shrink from $10.7 trillion to about $5 trillion. The United States would remain in first place with GDP of $52.9 trillion, followed by China at $47.9 trillion.
China’s share of global GDP is projected to rise to 21%, while the U.S. share falls to 23%. According to IMF data, China is already the world’s largest economy in 2026 when measured by purchasing power parity, which accounts for differences in local prices. China’s rise is part of a broader shift toward Asia, whose share of global GDP is projected to increase from around 32% in 2026 to 39% in 2040.
Over the same period, Europe’s share is forecast to fall from 26% to 21%, while North America’s declines from 30% to 27%.
The United States is expected to remain the world’s largest individual economy, while growth in China, India and Indonesia gives Asia a greater role in shaping global demand and investment.
India is projected to rise from fourth place in 2026 to third in 2040. Its economy would more than triple from $4.5 trillion to $14.1 trillion, exceeding the projected combined output of Germany ($7.8 trillion) and Japan ($5.9 trillion).
CEBR says India stands to benefit as manufacturers diversify their supply chains away from China. Apple’s expansion of production in India is one example.
Germany and Japan are both expected to grow but lose ground in the rankings. Germany is projected to slip from third to fourth as India overtakes it, while Japan falls from fifth to sixth as the United Kingdom moves ahead.
Indonesia is projected to make an even bigger leap, from 17th to eighth. With GDP forecast to reach $4.2 trillion by 2040, it would overtake Italy, whose economy is projected to reach $3.8 trillion, pushing it out of the top 10. Spain is expected to remain in 12th place, just behind Italy, with GDP of $3.37 trillion.
