Article content continued

CEBR’s World Economic League Table for 2017 estimates Canada is currently the tenth largest economy in the world, but that it will fall back two spots to No. 12 by 2030.

Leapfrogging Canada in that time will be Indonesia, which CEBR forecasts will see GDP growth averaging 5.6 per cent between 2016 and 2020 and 5.5 per cent between 2021 and 2025. The South Asian island nation reduced its debt-to-GDP ratio from 100 per cent in the wake of the 1999 Asian financial crisis to 25 per cent in 2014, and its annual budget deficit is capped at 3 per cent.

South Korea is also expected to surpass Canada.

The report said the greatest risk to Canada’s economic status comes from an overheated housing market, especially in Vancouver and Toronto.

While Canada’s vast oil resources leave it subject to the price of Brent crude, it is less exposed than other oil-dependent economies, such as Russia, because Canada’s exports are more diversified in areas including auto manufacturing and other raw materials. Russia is also expected to drop two spots to be the fourteenth largest economy, after it climbs one spot to twelfth next year.

The trend of emerging market economies gradually surpassing their more developed counterparts is widespread. The world’s fifth-largest economy, the United Kingdom, had a GDP of more than U.S.$2.8 trillion in 2015, though this tally came before factoring in the decline in the British pound after the country voted to leave the European Union earlier this year. By 2030, both India and South Korea will have eclipsed the U.K. in overall size.