You heard the news: propelled by the AI frenzy, the chipmaker Nvidia passed the $3 trillion market cap and became the most valuable company in the world by market capitalization—for a few days last June, that is. Since then, things have returned more or less to what they used to be: as of September 3, 2024, when the market closed, Apple was still the king of the stock exchanges, closely followed by Microsoft. Incidentally, that was also the day when, amid a stock selloff, Nvidia lost $279 billion in market value, the largest wipeout in U.S. history (while still managing to retain the third spot).

Then again, Apple’s dominance is not to be taken for granted. After all, over the years, it lost the title of the world’s largest many times—more frequently, and very recently too, to Microsoft, but also to Amazon, Google, and even Saudi Arabia’s state oil giant Aramco. Market capitalization can change quickly, and in recent years the rankings of the world’s largest companies have seen some significant shifts.

How these companies get to the top, and how they get to stay there, has changed too. For years, Apple has often seen its market cap fall victim to its sales success. While the popularity of products such as the iPhone, Mac and iPads propelled Apple to new heights, whenever sales appeared to slow its market capitalization suffered.

By contrast, Microsoft built itself into one of the world’s largest companies with a focus on steady recurring revenue streams. You might not need a new smartphone or laptop every year, but a software license, cloud-computing package or video game subscription means ongoing payments—and client stickiness.

Then Apple started borrowing from Microsoft’s playbook: it launched news and games subscriptions, a video streaming service, and even its own credit card. Once Apple moved beyond hardware to software and services, its revenue growth became unstoppable. On January 3, 2022, Apple became the first company ever to surpass $3 trillion in market value, and it is still the world’s largest today.

Today, most of the top 10 companies by market capitalization are technology firms. Until a decade ago, many of the most valuable firms were traditional long-standing blue-chip industrial behemoths like Exxon, Chevron, General Electric or AT&T.

This is not to say that traditional sectors have lost all their appeal. Saudi Aramco continues to rank in the top 10, and Exxon, another oil giant, is hanging on in the top 20. Finance and healthcare are also represented. Berkshire Hathaway leads with a market value of over $1 trillion; Visa and Mastercard make the top 20 with a market cap of about $500 billion. Meanwhile, U.S. healthcare companies UnitedHealth Group and Eli Lilly, and Denmark’s Novo Nordisk are also in the top 20.

Yet, more often than not, the biggest companies by stock market valuation tend to be tech firms, even if they make things (Tesla) or sell things (Amazon)—not only that, rather than being a one-time purchase, these physical objects can often continue to generate steady and predictable revenue streams over long periods of time. Tesla, for example, has monthly fees for its autopilot and self-driving features, as well as for its premium connectivity package; Amazon offers all kinds of subscriptions and premium subscriptions linked to its Alexa, Fire TV, and Kindle devices.

Successful strategy (and product, and timing, and management) aside, the total dollar value of a company’s outstanding shares can be affected by a myriad of other unpredictable factors. It was not too long ago that a controversial tweet by former US President Donald Trump could send the stock markets spiraling downward or soaring to new highs without much rationale to support the move.

Then, there are even unforeseeable events like the Covid-19 pandemic. So-called stay-at-home stocks, particularly digital platforms and those in e-commerce, saw significant gains as shutdowns and remote working drove demand for new technologies. Conversely, tourism stocks and live entertainment services plummeted. When vaccines became available and the global economy slowly began to reopen, the landscape shifted once more: companies that had thrived during the shutdowns saw their values drop, while those poised to benefit from the reopening experienced a resurgence.

Focusing too closely on ever-changing share prices, investor sentiment, and world events rather than on underlying fundamentals can be misleading. Warren Buffett, the chairman of Berkshire Hathaway (the 8^th largest company as of Sept. 3), famously said that the stock market is a device for transferring money from the impatient to the patient.

Fear often drives decisions when it comes to buying and selling stocks, but even in these tumultuous times, amid lingering high inflation rates, the U.S. election, the war in Ukraine and Gaza, and a myriad of other geopolitical tensions and uncertainties, many businesses have experienced relatively little change in terms of assets, market share, revenues, cash flow, headcount, guidance and R&D.

This is why, to determine which is the largest, Fortune’s annual Global 500 list ranks the world’s top corporations by revenue instead of market capitalization. Where does Apple, the most capitalized company in the world, stand in Fortune’s ranking? By using the revenue metric, Apple—which made it into the top 10 for the first time only a few years ago—ranks just 7th globally and, along with Amazon, is the only big American tech company making the top 10. Meanwhile, supermarket juggernaut Walmart takes the top spot. When ranking companies by revenue, technology stocks do not fare as well as when they are ranked by their market value.

Why, then, do stock investors often prefer to pour money into startups that generate significant buzz but minimal or no revenue? Precisely because they hope to discover the next Apple or Amazon and turn hundreds into millions. Both Steve Jobs and Jeff Bezos, after all, always maintained that investing in future profitability through new products and services takes priority over hitting earnings estimates.

There is just no simple way to fully ascertain the size, influence and outlook of a company. To that end, the annual Forbes Global 2000 list takes yet a different approach—a multi-dimensional one. It ranks the world’s largest companies by using a composite score achieved by weighing revenues, profits, assets, and market value equally. Once again, different metrics will yield very different results: in this ranking, financial holding company JPMorgan Chase takes the top spot, while Apple is only twelfth, and Walmart barely makes it into the top 20.

In conclusion, while it is relatively straightforward—using economic, technical, and organizational criteria—to tell a large company from a small one, determining which is truly the largest is far more complicated. Is it Apple, with its massive market capitalization; Walmart, with revenues through the roof and over 10,000 stores across 19 countries; or JPMorgan Chase, with its huge assets and soaring profits?

Size, like many things in life, is in the eye of the beholder.

EDITOR’S NOTE: The annual Forbes Global 2000 ranks the world’s largest companies, listing the “best” based on Forbes’ composite score of revenues, profits, assets, and market value.

Two years ago, inflation reached a 40-year high in the United States. Globally, it grew in 179 out of 194 nations compared to 2020. Since then inflation’s global growth slowed, prompting hopes that prices paid by consumers would soon return to normal.

Unfortunately, bringing inflation down does not mean that consumer prices will revert to what they once were—they will just stop increasing so quickly and dramatically.

It is also important to point out the distinction between overall inflation and core inflation which is the key metric of the Consumer Price Index. The first includes food and energy prices—which are more sensitive to seasonal factors and fluctuate more rapidly—while the latter excludes food and energy prices because of their volatility. Core inflation sticks longer since gasoline prices fluctuate more than the prices of the cars fueled by said gasoline.

The most immediate inflation-fighting tool in the hands of policymakers is for the central bank to raise interest rates. Doing so dampens lending and thereby the overall economic activity that drives price increases. But sometimes the cure can be worse than the disease—raising interest rates at the wrong time or to the wrong level can trigger a recession, so central bankers tend to tread cautiously. However, this caution may have hamstrung the kind of bold action that was necessary to successfully confront and contain the unprecedented, dramatic surge in inflation across the globe in the aftermath of the 2020 pandemic.

Let’s rewind. In 2020—at the onset and during the worst phase of the pandemic—the increase in prices was relatively small. But a sudden, steep climb began in early 2021 with the easing of lockdowns and partial restoration of normal economic activity. Encouraged by the almost concomitant vaccine rollout in many countries, central bankers around the world were perhaps overly optimistic: they often described the first spikes in inflation as just “blips” bound to disappear soon.

They were certainly right about the main reason for those blips: Covid-19 had caused serious disruption to the global economy—supply-chain bottlenecks meant that demands for what consumers and firms wanted and needed could not be met which prompted demand to far exceed supply, driving prices upwards. What they could not imagine is that new variants of the virus would continue to bubble up, that so many people would resist or outright reject mask mandates and vaccines, and that the global distribution of vaccines would be so unequal and uneven. Sparked by a once-in-a-lifetime pandemic, episodic supply chain disruptions became endemic.

But there was also a second reason why central bankers tended to downplay the threat of inflation. The ability to reassure consumers and businesses that things are—and will be—fine is, in itself, a crucial part of their job description because the belief that prices will continue rising becomes a self-fulfilling prophecy as businesses raise prices to get ahead of impending cost increases. A rise in prices is often an effect of a rise in fear as much as it is an effect of rising costs.

When the fear of inflation gains traction, a business that does not change its prices often—for example a car manufacturer—will safeguard its profit margins by getting ahead of expected future inflation (and if it has already started experiencing higher costs, making up for past inflation as well). It is at that point that words like “blip” start appearing less often in the headlines and terms like “temporary” and “transitory” show up more often—how temporary and transitory generally remains unclear. Something else happens: wages rise. When workers expect to pay more for everything, they demand higher wages from employers to keep up with rising costs of living. When firms pay their employees more, those costs are passed on to consumers in the form of higher prices. This is the vicious circle of consumer price inflation—higher prices lead to higher wages, higher wages lead to even higher prices still.

The persistence of inflation despite central bankers raising interest rates consistently for years points to some novel features of the current post-pandemic moment: corporate consolidation and market concentration may be major contributing factors to the inflationary malaise. Many companies have used inflation as an excuse to hike prices far beyond the rise in production costs, scoring some of the best financial quarters and highest profit margins in their history. Asthma inhalers are perhaps the most notorious example of this, with prices jumping from roughly $10 a decade ago to $100 now even though production costs have not risen radically. This is why neologisms like “shrinkflation” (the practice of reducing the size or weight of a product with no corresponding reduction in price) and “greedflation” (a situation where the price increase of goods is not the result of an increase in their production costs) have started appearing in our newsfeeds. There is little that central banks can do about either of these phenomena and the inflationary pressure resulting from them with the tools at their disposal. Companies enjoying a semi-monopolistic grip on consumers’ choices can set prices however they like. 

What happens, then, when inflation keeps increasing instead of declining or slowing down? Nothing good. One possibility is what economists call “stagflation” where economic growth stalls, unemployment remains high and inflation remains at elevated levels. Then there’s every central banker’s nightmare scenario: hyperinflation in which prices grow uncontrollably sending the value of the currency into a seemingly unstoppable free-fall as in Weimar Germany after World War I. But one need not look to history to find examples of hyperinflation: Zimbabwe has been struggling with spiraling inflation for over a decade; Venezuela—the IMF estimates—will hit this year an inflation rate of 250% (which, believe it or not, is a stellar improvement compared to the five-digits rates of some years ago); Sudan is forecast to come second at about 145%; Argentina’s inflation crisis catapulted an unlikely far-right candidate into the presidency; and many other nations will experience a surge in prices many times greater than the 2% threshold that most central banks set as their optimal inflation target. Hyperinflation also provides the clearest proof that expectations on a mass scale play a fundamental role in determining the price of goods and services: when millions of people believe that their currency will be worth much less tomorrow, individuals and businesses begin rejecting the national currency in favor of alternatives such as cryptocurrencies or perhaps the U.S. dollar.

Then there’s the opposite extreme: persistent deflation which is what happens when prices continually fall. Continually falling prices are worrisome because it is a symptom of a weakening economy characterized by anemic consumer spending and low production levels (which leads to falling wages, which causes even lower demand for goods and services, which leads to even lower prices). Like inflation, not all deflations are alike: Greece—which during the debt crisis experienced a deflationary phase as a result of the wage and pension cuts part of its bailout terms—fell back into negative territory shortly after the beginning pandemic. Japan’s economy had been stuck in this vicious cycle for two decades: it was officially declared to be no longer in deflation only last March and subsequently ended decades of negative interest rate monetary policy. And then there is Switzerland, which for many years suffered—but also benefited—from deflation of its own making. The country managed to sustain its exports by countering the appreciation of its currency through super-low interest rates—yet, baffling many economists—avoiding at the same time the most dramatic effects of deflation (such as a crippling contraction in economic activities or high unemployment). Things only changed in 2022, when inflation hit a three-decade high of 2.8% and the Swiss National Bank was forced to raise its policy rate from -0.75% to 1.5% to combat it.

All these peculiar scenarios demonstrate why there is no one-size-fits-all solution when it comes to the many sides of inflation. Furthermore, once a crisis is over, another one can always appear out of nowhere. Energy prices were already on the rise before the Covid-19 pandemic—Russia’s invasion of Ukraine before and the Israel-Gaza war made the situation much worse.

Will this season of global higher inflation ever come to an end, then? If we have learned anything over the past few years, it is that it is very difficult to predict the future when it depends to such a great extent on the whims of viruses, authoritarian leaders, corporate executives and, yes, consumers too. But there are signs of progress. According to the IMF, inflation is falling faster than expected in most regions: globally, it is expected to fall to 5.8% in 2024, with less than 50 countries where it will exceed last year’s figures. In the meantime, central bankers will have to constantly rely on a wide variety of data to fine-tune their assessments and policies—kicking the tires of the economy as they go, so to speak.

The world has enough wealth and resources to ensure that the entire human race enjoys a decent standard of living. Yet, people in countries like Burundi, South Sudan and the Central African Republic continue to live in desperate poverty.  For other likely contenders for the undesirable title of the world’s poorest country—Afghanistan, Syria and Eritrea—years of political instability and conflict make it impossible to even attempt an assessment due to the lack of reliable economic figures.

So how do we determine the poorest countries in the world? While GDP per capita is often considered the standard metric, compensating for differences in living costs and rates of inflation by using purchasing power parity (PPP) can better assess an individual’s buying power in any given country.

It is hard to pinpoint a single cause for long-term poverty. Corrupt governments can make a very rich nation into a poor one. And so can a history of exploitative colonization, weak rule of law, war and social unrest, severe climate conditions or hostile, aggressive neighbors. Weaknesses compound: A country in debt will not be able to afford good schools, and a poorly educated workforce will limit capacity.

Underprivileged households worldwide suffered the severest social and economic consequences of the coronavirus pandemic. In the world’s poorest nations, where high levels of informal employment are also prevalent,  there were no social safety nets or temporary loans to keep businesses open and workers employed. The World Bank has forecasted that in low and middle-income countries, the current generation of students could lose up to 10% of their future average annual income.

Before Covid-19, the fraction of the world’s population living in extreme poverty—meaning on less than $1.90 a day—had fallen below 10% from more than 35% in 1990. The pandemic not only halted but reversed that progress: since the onset of the health emergency to the end of 2022, when in response to the rising cost of living the International Poverty Line (IPL) was also revised to $2.15, the World Bank estimated that an additional 198 million people were likely to have entered the ranks of the extremely poor. More recently, the institution has also stated that half of the world’s 75 most vulnerable countries are facing a widening income gap with the wealthiest economies for the first time in this century. Over the past two decades, it was widely believed that—as a result of lower-income nations generally improving their living standards faster than mature economies—the progressive economic convergence of richer and poorer countries would ultimately take place. Yet, one out of three in this particularly vulnerable group of 75 nations home to a quarter of humanity, 1.9 billion people, today is poorer than it was on the eve of the Covid-19 pandemic.

The numbers are striking: in the 10 richest countries in the world the average yearly per-capita purchasing power it is over $110,000, in the 10 poorest is less than $1,500. The worst part is that poverty is often likely to foster more poverty. In the latest edition of the World Economic Outlook report, the International Monetary Fund (IMF) explains how impoverished nations could slide further into hardship: “The growth decline implies worsening prospects or living standards and global poverty reduction. An entrenched low-growth environment, coupled with high interest rates, would threaten debt sustainability and could fuel social tension and hinder the green transition. Furthermore, expectations of weaker growth may deter investment in capital and technologies and so, in part, become self-fulfilling.”

Below is a ranking of the ten poorest countries, starting from the country ranked tenth poorest and progressing to the country ranked as the top poorest in the world for 2024. For the complete ranking of the world’s countries from poorest to richest, click here.

This country of roughly 35 million, one of the most impoverished on the Arabian Peninsula, has been embroiled in conflict since late 2014 as a result of the power struggle between the Saudi-backed government and the rebel Houthi movement. The war has claimed the lives of more than 150,000 people, shattered the economy and destroyed critical infrastructure. As a result, today, in this oil-rich land over 80% of the population lives in poverty.

Since becoming independent from France in 1960, Madagascar has experienced bouts of political instability, violent coups and disputed elections. Elected in 2019, president Andry Rajoelina came to power promising to tackle corruption, reduce poverty, and develop the economy. Mostly, they turned out to be just that: promises. Madagascar still holds one of the highest poverty rates in the world at about 75%, growth is sluggish, and inflation stands at nearly 8%. Still, Rajoelina was re-elected  in December 2023.

To be fair, the country was also faced with an unprecedented series of challenges. Along with the economic and social consequences of the Covid-19 pandemic, when in 2022 grain deliveries from Ukraine collapsed following the Russian invasion, food prices skyrocketed, deepening the suffering of the citizens of the island. In addition, Madagascar ranks among the top 10 countries globally most vulnerable to climate hazards, with drought, floods and cyclones resulting in deaths and population displacement, and damage to homes, infrastructures and crops.

Africa’s oldest republic has ranked amongst the poorest countries in the world for many years. Expectations were high when the former football star George Weah became president in 2018. His years in office were instead marred by high inflation, unemployment and negative economic growth, until in 2023 he was defeated by opposition leader and former vice-president Joseph Boakai in a new round of elections. Boakai might have it easier than Weah: after contracting in 2020 and 2021, growth re-started in 2022. It is now projected to reach about 5.3% in 2024 and to stay above 6% in the years ahead.

One of Africa’s smallest nations, Malawi’s economy—largely dependent upon rain-fed crops—remains vulnerable to weather-related shocks. Food insecurity in rural parts is extremely high.

Malawi has enjoyed stable governments since it gained independence from Britain in 1964. However, in 2020, the constitutional court annulled former president Peter Mutharika’s win in the general elections citing vote tampering. Theologian and politician Lazarus Chakwera, who was sworn in his place, declared that he wanted to provide the kind of leadership that makes everybody prosper, but structural changes have been slow to materialize. Today, Malawi is grappling with an economic crisis that has led to fuel shortages, a surge in food prices, and a sharp devaluation of the currency. In 2023, according to the World Bank, over 70% of the population was estimated to be living below the international poverty line.

With 80% of its landlocked territory covered by the Sahara Desert and a rapidly growing population dependent upon small-scale agriculture, Niger is under threat from desertification. Food insecurity is high, as are disease and mortality rates. Recurrent clashes of the army with the Islamic State (ISIS) affiliate Boko Haram have displaced thousands.

In 2021, Niger inaugurated a new president—ex-teacher and former interior minister Mohamed Bazoum—in its first democratic transfer of power. With the economy expanding by 12% in 2022, things appeared to be looking up. Yet, in the summer of 2023, Bazoum was ousted and imprisoned by members of his presidential guard. The military junta has remained in power ever since.

Rich in resources and strategically located, this former Portuguese colony has often posted average GDP growth rates of more than 7% in the past decade. Yet it remains mired among the ten poorest countries in the world, with severe climate conditions and political instability being some of the main culprits. To make things worse, since 2017 attacks carried out by Islamic insurgent groups have plagued the gas-rich northern part of the country. Still, according to the IMF, the economy remains in high gear: it will expand by about 5% in 2024 and 2025, and it is projected to reach double-digit growth in the latter part of the decade.

Since gaining independence from Belgium in 1960, the DRC has suffered decades of rapacious dictatorship, political instability and constant violence, making it a regular in our rankings of the world’s poorest countries. About 65% of the country’s roughly 100 million population gets by on less than $2.15 a day. Yet the World Bank says the DRC has the resources and potential to become one of the richest countries in Africa and a growth driver for the entire continent. The country is already the world’s largest producer of cobalt and Africa’s leading source of copper—essentials in the production of electric vehicles.

Rich in gold, oil, uranium and diamonds, the Central African Republic is a very wealthy country inhabited by very poor people, and has been among the poorest countries in the world for the better part of a decade. For the first time since its independence from France in 1960, in 2016 the Central African Republic has democratically elected a president: former mathematics professor and prime minister Faustin Archange Touadéra, who campaigned as a peacemaker who could bridge the divide between the Muslim minority and the Christian majority.

Yet, while his successful election has been seen as an important step towards national reconstruction, large swaths of the country remain controlled by anti-government and militia groups. Despite problems and setbacks, in recent years growth has moderately picked up, driven by the timber industry, the revival of the agricultural sector, and the partially resumed sale of diamonds.

Tiny landlocked Burundi lacks natural resources and has been scarred by a civil war lasting from 1993 to 2005, whose aftermath is still a contributing factor to its ranking of the second-poorest country in the world. With about 80% of Burundi’s roughly 13 million citizens relying on subsistence agriculture, food insecurity is almost twice as high as the average for sub-Saharan African countries. Furthermore, access to water and sanitation remains very low and less than 5% of the population has electricity. President Evariste Ndayishimiye has made an effort to relaunch the economy and repair diplomatic relationships, and in 2022 both the US and the European Union resumed aid after lifting financial sanctions. Unfortunately, while growth is picking up, inflation is projected this year to be around 22%.

The very poorest of the world’s poorest countries, South Sudan has been wracked by violence since its creation in 2011. Rich in oil reserves, the landlocked state of roughly 15 million represents a textbook example of the “resource curse,” whereby abundance fosters political and social divisions, inequality, corruption and warfare. The majority of the population is employed in traditional agriculture, although violence and extreme climate events often prevent farmers from planting or harvesting crops. This year, an estimated 9 million people, over 60% of South Sudan’s population, will be in need of humanitarian assistance.

Source: International Monetary Fund, World Economic Outlook April 2024. Values are expressed in current international dollars, reflecting the corresponding exchange rates and PPP adjustments.

Would you rather be rich in a poor country or poor in a rich one? Measuring the wealth of nations is not that easy (spoiler: it is not just about gross domestic product, or GDP). Determining how rich you are depends to a large degree on how rich and poor countries are defined.

If we simply consider a nation’s gross domestic product—the sum of all goods and services produced by a country during one year—then we would have to conclude that the richest nations are exactly the ones with the largest GDP: United States, China, Japan, Germany. But how could the economies, for example, of Singapore or Luxembourg ever match that of such powerhouses when they are no more than small dots on the world map?

Another problem with GDP is that it does not measure income inequality, that is, how a country’s riches are distributed among the population. That is why a more accurate representation of people’s living conditions begins with dividing a nation’s GDP by the number of people that live there: per capita GDP and its growth rate tell us much more about the social wealth potentially available to each person and whether this wealth is either increasing or decreasing over time.

However, using per capita GDP still poses a problem: the very same income can buy very little in some countries and go much further in others where basic necessities—food, clothing, shelter, or healthcare—cost far less. To gauge how wealthy a country’s citizens are it is necessary to understand how much they can buy. That is why, when comparing per capita GDP across countries, GDP should be adjusted for purchasing power parity, which helps us take into account the inflation rates and the price of goods and services in each given place.

When considering whether it is better to be rich in a poor country or poor in a rich one, the best chance of enjoying a superior standard of living is to reside in a richer nation no matter where a person falls on the income distribution scale. Then again, wealth for some without a good measure of equality for everyone is problematic, to say the least. The coronavirus pandemic proved it most strikingly. Low-income workers, often migrants, living in some very wealthy nations suddenly found themselves unemployed, homeless and stranded without much of a safety net. Many less affluent nations, in the meantime, bent over backwards to take care of all those in need during the crisis.

Further, the quality and availability of healthcare often go hand in hand with the quality and availability of education services, social security, housing assistance and other components of the social infrastructure. A country might boast a high GDP or a high GDP per capita but, if such services are inadequate or inaccessible to a significant portion of the population, these citizens will feel poor, regardless of the economic indicators might suggest.

Additionally, when it comes to inflation, because energy and food are essential goods with few substitutes higher prices are particularly painful for low-income households. It is easier for families to cut down or eliminate spending on electronics, clothing or entertainment when prices surge, but when it comes to food, heating or transportation—crucial to both live and earn a living—this becomes much more difficult. As a result, an inflationary scenario can often pose a threat to economic and social stability.

This is why, in the long run, it is better not only to be rich but to be egalitarian as well. Too much economic inequality stifles growth for all, political instability is more likely, healthcare care costs and mortality rates are higher, and so are crime and corruption rates. Being rich in a poor country also has costs.

Source: International Monetary Fund, World Economic Outlook April 2024. Values are expressed in current international dollars, reflecting the corresponding exchange rates and PPP adjustments.

What do people think when they think about the world’s richest countries? And what comes to mind when they think about the world’s smallest countries? Many people would probably be surprised to find that many of the planet’s wealthiest nations are also among the tiniest.

Some very small and very rich countries—like San Marino, Luxembourg, Switzerland and Singapore—benefit from having sophisticated financial sectors and tax regimes that attract foreign investment, professional talent and large bank deposits. Others like Qatar and the United Arab Emirates have large reserves of hydrocarbons or other lucrative natural resources. Shimmering casinos and hordes of tourists are good for business too: Asia’s gambling haven Macao remains one of the most affluent states in the world despite having endured almost three years of intermittent lockdowns and pandemic-related travel restrictions.

But what do we mean when we say a country is “rich,” especially in an era of growing income inequality between the super-rich and everyone else? While gross domestic product (GDP) measures the value of all goods and services produced in a nation, dividing this output by the number of 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 small number of inhabitants.

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), often expressed in international dollars to allow comparisons between different countries.

Should we then automatically assume that in nations where PPP is particularly high the overall population is visibly better off than in most other places in the world? Not quite. We are dealing with averages and within each country structural inequalities can easily swing the balance in favor of those who are already advantaged.

The COVID-19 pandemic lifted the veil on these disparities in ways few could have predicted. While there is no doubt that the wealthiest nations—often more vulnerable to the coronavirus due to their older population and other risk factors—had the resources to take better care of those in need, those resources were not equally accessible to all. Furthermore, the economic fallout of lockdowns hit low-paid workers harder than those with high-paying occupations and that, in turn, fueled a new kind of inequality between those who could comfortably work from home and those who had to risk their health and safety by traveling to job sites. Those who lost their jobs because their industries shut down entirely found themselves without much of a safety net—large holes in the most celebrated welfare systems in the world were exposed.

Then as the pandemic subsided, inflation surged globally, Russia invaded Ukraine, exacerbating the food and oil price crisis. The Israel-Hamas followed, bringing more disruption to supply chains and commodity and energy markets. Lower-income families always tend to be hit the hardest, as they are forced to spend greater proportions of their incomes on basic necessities—housing, food and transportation—whose prices are more volatile and tend to increase the most. 

In the 10 poorest countries in the world, the average per-capita purchasing power is less than $1,500 while in the 10 richest it is over $110,000, according to data from the International Monetary Fund (IMF).

A word of caution about these statistics: the IMF has warned repeatedly that certain numbers should be taken with a grain of salt. For example, many nations in our ranking are tax havens, which means their wealth was originally generated elsewhere which artificially inflates their GDP. While a global deal to ensure that big companies pay a minimum tax rate of 15% was signed in 2021 by more than 130 governments (a deal that has yet to be implemented due to the opposition of legislators and politicians in many of them), critics have argued that this rate is barely higher than that tax havens like Ireland, Qatar and Macao. It is estimated that over 15% of global jurisdictions are tax havens and the IMF has estimated further that by the end of the 2020s, about 40% of global foreign direct investment flows could be attributed to shrewd tax-evading tactics, up from 30% in the 2010s. In other words: these investments pass through empty corporate shells and bring little or no economic gain to the population where the money ends up.

Since the discovery of large offshore reserves in the late 1960s, Norway’s economic engine has been fueled by oil. As Western Europe’s top petroleum producer, the country has benefited for decades from rising prices.

Until it didn’t: prices crashed at the beginning of 2020, then the global pandemic ensued—and the krone was sent into freefall. In the second quarter of that year, Norwegian GDP fell by 6.3 %, the biggest decline in half a century and possibly since World War Two.

Does that mean Norwegians became significantly less wealthy than they were before the pandemic? Certainly not. After the initial shock, the economy gradually pared the losses and rebounded.

Further, when it comes to any unforeseen economic problem, Norwegians can always count on their $1.4 trillion sovereign wealth fund, the world’s largest. Not only that, unlike many other rich nations, Norway’s high per capita GDP figures are a reasonably accurate reflection of the average person’s economic well-being. The country boasts one of the smallest income inequality gaps in the world.

Did we say that the wealthiest countries are also the smallest? That is certainly not the case with the United States, which first entered the top 10 list in 2020 after hovering just beyond tenth place for the better part of the past two decades.

Its surge, at least initially, was largely due to pandemic-related socioeconomic measures, which boosted income and spending, and to falling energy prices, which pushed petroleum-based economies like Qatar, Norway and the United Arab Emirates down several rankings, while Brunei fell out of the top 10 entirely.

Still, the country has since managed to build on the momentum and maintain its presence in the highest tier of the list. Not only did the US have its shortest recession on record in early 2020, lasting only two months, but its economy is now booming. In April, the IMF upgraded its 2024 projections for US economic growth to 2.7% (+0.6% higher than it forecasted just a few months earlier), but the performance of the United States—according to the Fund—will be this year “a major driver of global growth.”

Tiny San Marino is the oldest republic in Europe and the fifth smallest country on the map. It may have only 34,000 citizens, but it is among the wealthiest citizenry in the world. It helps that income tax rates are very low, at about one-third of the EU average. Nonetheless, San Marino is working towards harmonizing its fiscal laws and regulations with those of the European Union (EU) and international standards.

The tiny nation showed remarkable resilience during the pandemic and after amid tight monetary conditions and the energy crisis, with its tourism industry and manufacturing sector turning especially strong performances.

White chocolate, the bobsleigh, the Swiss Army knife, the computer mouse, the immersion blender, velcro, and LSD are just some of the noteworthy inventions brought to the world by Switzerland. This country of about 8.8 million people owes much of its wealth to banking and insurance services, to tourism, and to the export of pharmaceutical products, gems, precious metals, precision instruments (think watches) and machinery (medical apparatuses and computers).

According to the 2023 Global Wealth Report by Credit Suisse, Switzerland once again came out on top when it comes to the mean average wealth per adult at a whopping $685,230. Furthermore, roughly one adult in six owns assets worth more than one million U.S. dollars. Is it really a surprise that Switzerland has the highest density of millionaires in the world?

But does that mean the Swiss is immune from economic woes? Not only the pandemic had a significant impact on the economy, but—due to the country’s heavy reliance on imports of oil and gas from Russia—the war in Ukraine led to a surge in energy prices and triggered supply chain disruptions. Further, in 2022 Credit Suisse nearly imploded before a government-engineered rescue by its long-time rival, UBS Group, pulled it back from the edge. The demise of Credit Suisse has shaken the country, damaging Switzerland’s reputation as a secure and reliable global banking center.

And that’s not all: last year, in a bid to curb inflation, the Swiss National Bank (SNB) raised its interest rate from -0.75% to 1.75%.  Such a move had its consequences, including a surge in investment costs and a slowdown in economic growth—this, while the country was already experiencing a slump in exports, particularly to Germany, Switzerland’s second trading partner after the US, currently facing its own set of economic challenges.

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, the United Arab Emirates’ highly cosmopolitan populationenjoys 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; only about 20% of the people living in the country are actually locally-born.

The UAE’s economy is also becoming increasingly diversified. Outside of the traditionally dominant hydrocarbon sector, tourism, construction, trade and finance are major industries. This is not to say that the UAE was not impacted by the pandemic and the concomitant fall of oil prices: quite the contrary. Incredible as it may seem, the UAE briefly slipped out of the IMF’s ranking of the richest countries globally for the first time in decades. Yet fossil fuels have not gone out of fashion: as soon as energy prices recovered, the UAE quickly regained its historic position among the top 10 richest countries in the world.

Despite the recent recovery, oil prices have on average declined since the mid-2010s. In 2014, the per-capita GDP of a Qatari citizen was over $143,222; one year later, it plunged significantly and remained below the $100,000 mark for the next five years. However, that figure has gradually grown, increasing by about $10,000 each year.

Still, Qatar’s oil, gas and petrochemical reserves are so large and its population so small—just 3 million—that this marvel of ultramodern architecture, luxury shopping malls and fine cuisine has managed to stay atop the list of the world’s richest nations for 20 years.

No rich country, however, is without its problems. With only about 12% of the country’s residents being Qatari nationals, the initial months of the pandemic saw Covid-19 spreading rapidly among low-income migrant workers living in crowded quarters, triggering one of the highest rates of positive cases in the region. Then, falling energy prices meant falling government and private sector revenues. An export-oriented economy, Qatar also suffered from the disruption in global trade caused by the war in Ukraine. Later on, the conflict in Gaza sparked renewed fears and uncertainty across the Middle East. Still, until now, the economy has proven to be sufficiently resilient. It is projected to grow by around 2% in 2024 and 2025.

With assets of about $16 billion, the richest person living in Singapore is an American: Eduardo Saverin, the co-founder of Facebook, who in 2011 left the U.S. with 53 million shares of the company and became a permanent resident of the island nation. Like many other fellow millionaires and billionaires, Saverin did not choose it just for its urban attractions or natural gateways: Singapore is an affluent fiscal haven where capital gains and dividends are tax-free.

But how did Singapore manage to attract so many high-net-worth individuals? When the city-state became independent in 1965, one-half of its population was illiterate. With virtually no natural resources, Singapore pulled itself up by its bootstraps 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 98% of the adult population is now literate.

Unfortunately, that did not make it immune from the pandemic-driven global economic downturn: in 2020, the economy shrank by 3.9%, knocking the nation into recession for the first time in more than a decade. In 2021, Singapore’s economy bounced back with an 8.8% growth, but then the slowdown in China, a top trading partner, derailed the recovery. China’s economic problems hit Singapore’s manufacturing sector—which makes up roughly 20% of Singapore’s total GDP—particularly hard. The economy expanded by just 1% in 2023, and is not projected to grow much further than 2% in 2024 and 2025.

A nation of about 5.3 million inhabitants, the Republic of Ireland was one of the hardest hit by the 2008-9 financial crisis. Following politically difficult reform measures like deep cuts to public-sector wages and restructuring its banking industry, the island nation regained its fiscal health, boosted its employment rates and saw its per capita GDP grow exponentially.

However, context is important. Ireland is one of the world’s largest corporate tax havens, which benefits multinationals far more than it benefits the average Irish person. Halfway through the 2010s, many large US firms—Apple, Google, Microsoft, Meta and Pfizer to name a few—moved their fiscal residence to Ireland to benefit from its low corporate tax rate of 12.5%, one of the most attractive in the developed world. In 2023, these multinationals accounted for close over 50% of the total value added to the Irish economy. If Ireland were to adopt the minimum corporate tax rate of 15% proposed by the OECD and already implemented by many countries, it would lose its competitive advantage.

Further, while Irish families are undoubtedly better off than they used to be, the national household per-capita disposable income remains slightly lower than the overall EU average according to data from the OECD. With a considerable gap between the richest and poorest (the top 20% of the population earns almost five times as much as the bottom 20%), most Irish citizens would likely balk at the idea that they are among the richest in the world.

Just a few years ago, many were betting that the Las Vegas of Asia was on its way to becoming the richest nation in the world—it encountered a few bumps along the road. Formerly a colony of the Portuguese Empire, the gaming industry was liberalized in 2001 this special administrative region of the People’s Republic of China has seen its wealth growing at an astounding pace. With a population of about 700,000, and more than 40 casinos spread over a territory of about 30 square kilometers, this narrow peninsula just south of Hong Kong became a money-making machine.

That, at least, was until the machine started losing money rather than making it. When Covid struck, global traveling came to a halt, and for a while Macao even slipped out of the 10 richest nations ranking. Since then, Macao has returned to business as —and then some. Its per-capita purchasing power was about $125,000 in 2019—it is even higher today.

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 in the country again. Doing so would be a pity: situated at the very heart of Europe, this nation of close to 670,000 has plenty to offer, both to tourists and 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.

While the global financial crisis and pressure from the EU and OECD to reduce banking secrecy may have had little impact on Luxembourg’s economy, the coronavirus outbreak forced many businesses to close and cost workers their jobs. Yet, the country has weathered the pandemic better than most of its European neighbors: its economy rebounded from -0.9% growth in 2020 to over 7% growth in 2021. Unfortunately, due to high interest rates, the war in Ukraine, and a broader deterioration of the economic conditions in the Eurozone, that rebound did not last long: the economy grew by just 1.3% in 2022 and even contracted by 1% in 2023 (although it is projected to grow by 1.2% this year.)

Still, weak economic growth may not be worth complaining when your living standards are this high: Luxembourg topped the $100,000 mark in per capita GDP in 2014 and has never looked back ever since.

Source: International Monetary Fund, World Economic Outlook April 2024. Values are expressed in current international dollars, reflecting the corresponding exchange rates and PPP adjustments.

You might have never heard of Nauru, a tiny island in the South Pacific Ocean, which for a few years during the past decade was the fastest-growing economy on Earth. The reason? Bird poop, specifically the island’s fossilized bird guano supply, an exceptional, and therefore expensive, natural fertilizer. Once the supply began drying up, Nauru’s gross domestic product surge virtually ceased. The island now survives economically due to the support it receives from Australia, which has built a detention center there for imprisoned asylum seekers. Such sudden injections of foreign funds can boost economic output dramatically—at least on paper—but the truth is that Nauru is facing financial ruin.

The story of this island is a cautionary tale about the perils of nations relying on just one source of income for their economic well-being instead of trying to develop a diversified economy. The people of another quite small nation, Guyana—215,000 square kilometers bordering Brazil, Suriname, Venezuela and the North Atlantic Ocean—could learn a thing or two from Nauru’s experience.

A few years ago—following one of the largest offshore crude discoveries in decades—Guyana became officially an oil producer. With output currently reaching approximately 650,000 barrels per day and growing, the windfall is already transforming the nation from one of the poorest per capita in Latin America into one of the richest. This year, excluding one-off rebounds from previous double-digit downturns (Macao or Maldives welcoming back tourists after Covid, for example), Guyana is set to maintain its status as the world’s fastest-expanding economy for the fifth year in a row, with a GDP growth rate of almost 34%.

Yet, experts have already warned of the so-called “resource curse,” meaning the mismanagement of revenue from oil extraction, which has historically been linked to slow economic growth, corruption, authoritarianism and a whole array of social maladies as the example of Venezuela demonstrates. To address these concerns, Guyana’s government has implemented a sovereign wealth fund and promised to invest all oil profits in the construction of roads, schools and hospitals. However, critics have argued that the guidelines and rules governing the fund are less than transparent, and have questioned whether these sudden riches will enrich just a few or lift many out of poverty. In the meantime, Guyana’s fishermen in the coastal area say that all the drilling and vibrations from oil exploration are ruining the marine environment, and that today their catches are a small fraction of what they used to be. Exploiting one of Guyana’s natural resources is damaging another.

While the jury is still out for Guyana, the experiences of Nauru or Venezuela tell us that single-year GDP figures can be misleading, since many once-fast-growing economies have experienced quick and dramatic downfalls, and because not everyone shares in all the benefits or downsides of an economy’s shifting fortunes.

At the other end of the spectrum, one can find the examples of Ethiopia, Rwanda, Mongolia, China, India, Bangladesh or Vietnam, which have shown sustained, robust GDP growth over many years among close to 200 nations routinely surveyed by the IMF.

Meaningful economic growth is a marathon, not a sprint. Amid bouts of ethnic violence and extreme weather events exacerbated by climate change, over the past two decades Ethiopia has still managed to make improvements to its infrastructure and encourage greater private-sector involvement in an attempt to transform its agriculture-based economy into a manufacturing hub. Rwanda—with its extensive economic development and poverty reduction programs—shows what efficient and democratic political institutions can do to a country once ravaged by civil war and genocide: turn it into an economic miracle. Despite having encountered a few bumps along the road, China remains on track to pass the US as the world’s largest economy in the next decade. Meanwhile, Bangladesh, Vietnam and India—which is expected to surpass Germany and become the third-largest economy by 2027—have taken a page from China’s playbook by turning themselves into thriving manufacturing centers first and expanding to higher value-added sectors later.

It is not too hard to see which nations have made sustainable plans for the long haul and which ones bet their economic futures on a single commodity. It will be interesting to see how they all fare 10 years from now.