Does the Internet Grow GDP?
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According to a new report from McKinsey, the current Internet revolution is driving fast-paced economic change not seen since the 19th century. The research firm found that Sweden leads the world in Internet contribution to GDP at 6.3 percent. So how do Asian nations fare?
According to a new report from McKinsey, the current Internet revolution is driving fast-paced economic change not seen since the 19th century. The research firm found that Sweden leads the world in Internet contribution to GDP at 6.3 percent. So how do Asian nations fare?
South Korea and Japan lead the way at 4.6 percent and 4.0 percent respectively. While India and China trail at 3.2 percent and 2.6 percent respectively. In Hong Kong, the internet contributed over $12 billion tothe country’s economy in 2009, and this is expected grow to HK$146 billion by 2015, according to new research.The share of GDP is also projected to grow to 7.2 percent in 2015.
The leading European internet economies generate between 6 percent and 7 percent of GDP from the internet. The report, which Boston Consulting said is the first in Asia to identify the size of the internet economy in a particular country, states that the internet has transformed major industries including international trading, finance and small businesses.
The influence of the Internet is not restricted to web industries.
In fact, McKinsey found that [quote]”75 percent of the economic impact of the Internet arises from traditional companies that don’t define themselves as pure Internet players.” That said, businesses that rely on the web tend to grow at twice the speed of businesses with “minimal or no [web] presence.” [/quote]
Astonishingly, if the Internet were considered as its own sector, its contribution to global GDP would outweigh that of energy, agriculture, mining, and other industries.
So things are changing fast in Asia. The report notes that [quote] “India is leading in the growth component with China second, followed closely by Brazil and South Korea, while Japan is near the bottom of the growth rankings.” [/quote]
McKinsey also outlined its top 250 internet related firms. Here’s how they broke down by country:
