Brunei: The fifth richest country out of 182 nations. Courtesy of Forbes
Brunei Darussalam: The fifth richest country out of 182 nations. Courtesy of Forbes
FORBES has ranked Brunei Darussalam as the fifth richest country out of 182 nations due to its extensive petroleum and natural gas fields giving the Sultanate just over US$48,000 per capita.
In its online report, Forbes explained that to rank the world's wealthiest countries, it looked at GDP (gross domestic product) per capita adjusted for purchasing power. It used data compiled from the International Monetary Fund (IMF) from 2010, which was the most recent available set of figures.
"The PPP (purchasing-power parity)-adjusted GDP, preferred by economists when making international comparisons, takes into account the relative cost of living and inflation rates rather than just exchange rates, which may distort real differences in worth," stated the Forbes report.
Earlier this month, the Department of Economic Development and Planning (JPKE) reported that Brunei's consumer price index had increased 1.8 per cent from 2010 to 2011 and growth averaged less than one per cent each month. JPKE also said that the average annual CPI in 2011 was 106.9 compared to 104.8 in 2010, which resulted in an inflation rate of two per cent over the period of 12 months from January to December in 2011.
Brunei Darussalam's economy has been dominated by the oil and gas industry for the past 80 years, and hydrocarbon resources account for over 90 per cent of its exports and more than half its GDP. Brunei currently has the second highest GDP per capita in the Southeast Asian region and is the fourth largest oil producer in the region and ninth largest exporter of LNG (liquefied natural gas) in the world.
Information from the Brunei Economic Development Board (BEDB) stated that the Sultanate has a "low tariff regime and no capital gains or personal income tax".
The Oxford Business Group, last year, published a report stating that the IMF report that was released in mid-June noted that many of the key economic indicators were performing well with "GDP rebounding in 2010, after two years of decline, the country's current account surplus is also well into the black and inflation under control".
The Forbes report ranked Qatar as the wealthiest country in the world, also due to its oil prices and massive gas reserves. "Adjusted for purchasing power, Qatar booked an estimated GDP per capita of more than US$88,000 for 2010," it reported. The country has the third largest reserve of natural gas in the world.
"Qatar has lured multinational financial firms to the country, as well as satellite campuses of US universities," stated the report. It added that the Qatar Government is also investing heavily in infrastructure, including a deepwater seaport, an airport and a railway network, "all with the eye to make the country a better host for businesses and the 2022 World Cup".
Luxembourg is ranked second on the Forbes list with a GDP on a PPP basis of just over US$81,000. "The country of half a million people became a financial hub in the latter half of the 20th century, in part, thanks to strict banking secrecy laws that earned it the reputation of a tax haven," stated the Forbes report.
Singapore falls in third place with a GDP per capital of nearly US$56,700. Brunei's neighbour has a thriving technology, manufacturing and finance hub which has allowed it a space on the top three richest countries in the world.
Norway was ranked the fourth richest country, also due to its petroleum which accounts for nearly half of exports and is the main contributor to its PPP-adjusted GdP per capita of nearly US$52,000. "The numbers must be taken with a grain of salt, and that's because there are a host of issues that can make any GDP comparisons misleading, including how the quality of goods varies from country to country," stated Gian Luca Clementi, an associate professor of economics at New York University's Leonard Stern School of Business, who was interviewed for the Forbes report.
Forbes also reported that the three poorest countries in the world are African nations, Burundi, Liberia and the Democratic Republic of Congo, where their PPP-adjusted GDP per capita are US$400, US$386 and US$312, respectively.