Davos—the World Economic Forum’s annual meeting—is in full swing through January 19. All this week, our daily charts will focus on some of the key themes of the event, including resilience, sustainability, reimagining globalization, generative AI, and inclusive, equitable growth. For more, see “McKinsey and the World Economic Forum 2024.”
About 4.7 billion people (61 percent of the world’s population) live below the empowerment line—the level at which people can afford to meet essential needs such as nutrition, housing, healthcare, and education. McKinsey Global Institute chair and senior partner Sven Smit and colleagues estimate that closing the empowerment gap would require boosting the spending power of those below the line by $37 trillion over the coming decade. Accelerated growth and business-led innovation could achieve some of those gains, though the impact would vary from region to region. China and India, for example, could erase more than 90 percent of the empowerment gaps, lifting about 700 million people in India and over 730 million in China above the threshold by 2030. The impact would likely be significantly less in regions such as sub-Saharan Africa.
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A series of circles show the empowerment gap of each region and how much is left unfilled after growth and business-led innovation. Sub-Saharan Africa’s gap is $9.314 trillion and 77% unfilled. India’s is $5.341 trillion and 8% unfilled. China’s is $4.428 trillion and entirely filled. Other Asia’s is $4.489 trillion and 27% unfilled. Latin America’s is $3.965 trillion and 40% unfilled. The US’s is $4.489 trillion and 45% unfilled. The EU and UK’s is $2.325 trillion and 24% unfilled. The Middle East’s is $1.404 trillion and 30% unfilled. Japan’s is $380 billion and 24% unfilled. Australia, Canada, and New Zealand’s is $283 billion and 24% unfilled.
Source: Climate Policy Initiative; Conference Board; Damodaran Online; FAOSTAT; International Energy Agency; International Monetary Fund; NGFS; OECD; Oxford Economics; WageIndicator; World Bank; World Data Lab; McKinsey analysis; McKinsey Global Institute analysis.
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To read the report, see “From poverty to empowerment: Raising the bar for sustainable and inclusive growth,” September 18, 2023.