Developing economies now produce 41 percent of the world's output, up from 36 percent in 2000, according to the World Development Indicators 2008, released on April 11.

The combined output of the world's economies reached US$59 trillion in 2006. Using new measurements that take into account the differences in price levels between countries, China now ranks as the second largest economy in the world, and 5 of the 12 largest economies are developing economies. Strong growth over the period has increased the shares of all developing regions except Latin America and the Caribbean, while the share of high-income economies fell by 5 percent.

This year's World Development Indicators (WDI) introduces new estimates of purchasing power parity (PPP). PPPs are used to convert local currencies to a common currency - in this case the US dollar. By taking account of price differences between countries on a broad range of products and services, PPPs allow more accurate comparisons of market size, the structure of economies, and what money can buy. The new PPPs replace previous benchmark estimates, many of them from 1993 and some dating back to the 1980s. These new estimates are based on the recently released results of the International Comparison Program (ICP) -- a cooperative program involving 146 economies.

"We live in a world of highly interdependent markets for goods, services, finance, labor, and ideas," said Alan Gelb, Acting World Bank Chief Economist and Senior Vice President for Development Economics. "When we measure economies on a comparable global scale, the growing clout of developing countries comes into sharp relief."

World Development Indicators 2008 (WDI) provides a detailed picture of the world through data. It includes, for example, information on health expenditures, on transport and other infrastructure services, on the quality of public sector management, on Internet access, on access to improved water sources, and on carbon dioxide emissions.

This 12th edition of the WDI also presents the major findings of the 2005 ICP round and explores some of their implications. For example, because price levels are lower in many developing countries, the new data show real expenditures on education and health care are much higher than previously estimated. For the same reason, official development assistance (ODA) goes farther when spent in the poorest countries because local goods and services are cheaper. But the data also show that spending alone does not assure good outcomes. In parts of southern Africa affected by HIV/AIDS, life expectancies are more than 20 years shorter than in other countries with similar health spending.

A comprehensive guide to development trends

The WDI provides the information needed to monitor progress toward the Millennium Development Goals (MDGs). Following recommendations from the United Nations, this year's edition includes new indicators on employment, reproductive health, access to anti-retroviral drugs, and biodiversity. Special sections look at the evidence on climate change, reproductive health services and maternal mortality, and methods of measuring governance.

"The goal of the WDI is to present a comprehensive picture of the world using the best statistical evidence available," explained Eric Swanson, Program Manager with the World Bank's Development Data Group. "The World Development Indicators allows us to view development not just in terms of economic outputs, but also through the welfare of people, the condition of the environment, and the quality of governance."

Improving development statistics

The WDI draws on a database of over 1,000 indicators covering 209 countries and territories, but there are still serious gaps, especially in statistics from poor countries.

"Statistics are fundamental," said Shaida Badiee, Director of the Development Data Group. "Without reliable statistics, there is no accountability. Improving the quality of development statistics is a long-term effort that is now receiving growing support from our development partners."

(China Development Gateway April 11, 2008)