(Feb. 27) WASHINGTON, D.C. — As the U.S. prospers, so will the world.
That’s the subtext of the U.S. Department of Agriculture’s economic assumptions for the next 10 years about the course of the agricultural economy, according to data presented at the agency’s Feb. 19-20 Agricultural Outlook Forum.
The U.S., accounting for 30% of the global gross domestic product, will play the dominant role in determining economic conditions around the world, the USDA reported in the publication “USDA Agricultural Baseline Projections to 2013.”
The USDA argues that the U.S. gross domestic product should increase by 3.3% in 2004, 3.5% in 2005 and then average 3% in 2006 and beyond.
Heavy investment in technology in the late 1990s should provide a base for sustainable growth throughout the projection period.
Meanwhile, the USDA reports the global economy is pegged to grow 2.3% annually from 2001 to 2005 before increasing to a 3.2% annual growth rate between 2006 and 2013.
By category, here are projections for the world economy:
- DEVELOPED COUNTRIES — Global growth relies on U.S., report says developed economies should grow at rates averaging 2.5% in 2006 and through 2013.
Europe will not grow as rapidly as the U.S., and the USDA says Japan continues to face significant problems. Japan’s share of the world’s economy is projected to be 13% by 2013, down 18% from 1991.
- UNDEVELOPED COUNTRIES — Growth in developing countries is projected by the USDA at 5.1% annually from 2006 to 2013. Long-term growth in transition economics of the former Soviet Union and eastern Europe is projected at 4.2% annually, a big improvement from the contractions suffered in the 1990s.
Latin American countries will average about 4% economic growth, while East and Southeast Asia economies will expand 6% annually. China’s economic growth is projected to average 7% in the next decade, according to the USDA.
The USDA said that economic growth in developing countries will result in greater demand for imported fruits, vegetables, meat and processed foods.
A slowdown in world population growth will shift more importance in food demand growth to the expansion of economies, the USDA said.
World population growth will decline from an annual rate of 1.7% in the 1980s to 1.1% per year in the next decade.
Developed countries will average population growth rates of 0.4%. However the population growth rate for the U.S., at close to 1%, is the highest among developed countries. Immigration is the reason for the higher growth rate in the U.S., the USDA said.