Pressbriefing17DEC20 07

International Comparison Program 2005: 

International Comparison Program 2005 Preliminary Results 17 December 2007

What are PPPs?: 

What are PPPs? Purchasing Power Parities (PPPs) convert values in local currency prices to “real” values in a common currency. They are based on multilateral comparisons of prices between countries. They permit the comparisons of real levels of output or income between countries, just as price deflators or a consumer price index allow real comparisons over time.

How are PPPs used? : 

How are PPPs used? 1993 System of National Accounts calls for real comparisons between countries to be done using PPPs. The World Bank uses PPPs as an input to establish international poverty lines and compare standards of living. IMF and World Bank publications report the size of economies and aggregate growth rates in PPP terms. EU allocates structural funds to member states. UNDP includes GNI measured at PPP in the Human Development Index.

ICP 2005: What has been achieved : 

ICP 2005: What has been achieved Most intensive effort ever to measure PPPs. New methodology and improved data collection for better data quality. National accounts reviewed and improved. China for the first time; India first since 1985. New governance arrangements. Framework established for continuous improvement.

Slide5: 

Scope and coverage of data collection

Organization of the ICP: 

Organization of the ICP Africa (48 countries) Asia & Pacific (23 countries) CIS (10 countries) South America (10 countries) West Asia (10 countries) Eurostat/ OECD (45 countries) ICP Executive Board Technical Advisory Group Global Office World Bank ICP under auspices of the UN Statistical Commission Organization of the ICP

Historical global ICP participation: 

Historical global ICP participation Number of countries participating

A snapshot of the world in 2005 Purchasing Power Parities: 

A snapshot of the world in 2005 Purchasing Power Parities Size of the world Economic well being Relative living costs

A new view of world economy: 

A new view of world economy World Share of GDP Based on market exchange rates World Share of GDP Based on PPP Middle-income economies, 32% Low-income economies, 7% Low-income economies, 2% Middle-income economies, 19% High-income economies, 78% High-income economies, 61%

The size of the world economy: 

The size of the world economy * Excludes oil-exporting countries. Note: Regional totals do not include all ICP participants.

People and their spending: 

People and their spending World Population (%) World PPP GDP (%)

The largest dozen: 

The largest dozen Twelve economies account for two-thirds of world expenditures. The five largest are US, China, Japan, Germany, and India. Seven are high income economies: US, Japan, Germany, the UK, France, Italy, and Spain. And five are low- or middle-income economies: China, India, Russia, Brazil, and Mexico.

Economic well being – PPP consumption per capita: 

Economic well being – PPP consumption per capita

The richest economies: 

The richest economies GDP per capita Consumption per capita Luxembourg Qatar Norway Brunei Darussalam Kuwait Luxembourg United States Iceland United Kingdom Norway

And the poorest economies: 

And the poorest economies GDP per capita Consumption per capita Congo Dem Rep Liberia Zimbabwe Guinea Bissau Ethopia Congo Dem Rep Liberia Zimbabwe Guinea Bissau Ethopia

Average PPP consumption across 146 economies: 

Average PPP consumption across 146 economies PPP consumption per capita (US$) 0 5,000 10,000 15,000 20,000 25,000 30,000 35,000 5,000 1,000 World Average 6,096 20,000

Comparing price levels: 

Comparing price levels Price level indexes are the ratio of an economy’s PPP to its exchange rate with another economy Measure cost of living or cost of doing business Or simply the most expensive or cheapest places to travel

Most and least expensive: 

Most and least expensive Most expensive Least expensive Iceland Denmark Switzerland Norway Ireland Tajikistan Ethiopia Gambia Kyrz Republic Bolivia

Higher prices in rich countries: 

Higher prices in rich countries Iceland Denmark Switzerland Norway

What is being released?: 

What is being released? Press release with summary of results for the GDP plus background material. 2005 International Comparison Program—Preliminary results: Tables showing PPPs, nominal and real expenditures, nominal and real per capita measures, and price level indices for Actual individual consumption, collective government consumption and gross fixed capital formation. Summary of major findings. Technical notes describing methodology and procedures. Annexes with history of the ICP, governance, other technical matters, glossary, and brief references. More detailed data to be released in February 2008 www.worldbank.org/data/icp

Slide21: 

Thank you! www.worldbank.org/data/ICP

What is being released?: 

What is being released? Press release with summary of results for the GDP plus background material. 2005 International Comparison Program—Preliminary results: Tables showing PPPs, nominal and real expenditures, nominal and real per capita measures, and price level indices for Actual individual consumption, collective government consumption and gross fixed capital formation. Summary of major findings. Technical notes describing methodology and procedures. Annexes with history of the ICP, governance, other technical matters, glossary, and brief references. More detailed data to be released in February 2008 www.worldbank.org/data/icp