We recently compiled a list of the 20 Most Advanced Countries in the World and in this article we look at the most developed country in the world.
World economy at a glance
The global economy has beaten expectations by showing resilience amid high inflation. The IMF forecasts that the global economy will grow by 3.2% in 2024 and 2025, the same as in 2023. The continued economic growth is driven by increased government spending, strong consumer spending and an unexpected boost to the labor force. Advanced economies are expected to grow by slightly higher rates of 1.7% and 1.8% in 2024 and 2025, respectively. Global inflation is expected to decline from 6.8% in 2023 to 5.9% in 2024 and 4.5% in 2025. Overall, the economy is expected to grow moderately, with the US being the best performer so far as it resumes its pre-pandemic growth. It is expected to grow by 2.7% this year, compared to the 1.7% growth of advanced economies. Also check out the top 50 countries in the world.
Global technology trends
In recent years, the global technology landscape has undergone a significant transformation. The two most dominant trends to emerge in 2023 were Generative AI and Electrification, according to a report by McKinsey & Company. Generative AI has seen a 700% increase in Google searches, including an increase in job postings and investments. The rapid advancement in AI is further reflected by the development of Large Language Models (LLMS) that are continuously expanding their capabilities. The innovative use of AI can be a dramatic breakthrough in various industries. For example, researchers from the Massachusetts Institute of Technology and ETH Zurich have developed an AI model that is able to accurately determine the stage of Ductal carcinoma in situ (DCIS), one of the most common breast cancer diseases, using cheap and simple tissue images. This could be a revolutionary step towards early diagnosis and treatment of breast cancer.
The other top technology trends, electrification and renewables, have shown resilience despite broader economic challenges. Their growth is driven by countries’ climate change commitments and energy security concerns. With growing concerns about reducing carbon emissions, investment in renewables and electric vehicles has surged in recent years.
Overall, the tech sector saw a decline in the economic climate, reflected by a 30-40% drop in tech stock investments. However, the overall growth trajectory of tech innovation offers a positive outlook. Investors have become more cautious in their investments. Nevertheless, AI is benefiting from increased investment due to its strong growth prospects. The rise in AI is also clearly visible in the publications and patents related to artificial intelligence. The tech sector’s talent landscape has seen significant layoffs in 2024, with the largest decline in tech-related vacancies. This was offset by high demand for specialized skills in generative AI and electrification. Read 25 Most Innovative Economies in 2024.
The global leader in AI
Nvidia Corporation (NASDAQ:NVDA) has emerged as a leader in the rapidly growing global technology landscape, particularly in the AI space. The company is a leading designer of graphics processing units (GPUs), the chips required for advanced computing. Over the past two decades, the GPU maker has transformed into one of the largest semiconductor companies in the world. Its continued innovation has helped it capture a significant share of the market in high-growth sectors like AI.
The dominance in AI hardware is evident from the company’s over 80% share of the data center GPU market. Its enterprise platform, Nvidia AI Enterprise, has tools like NVIDIA NIM and AI Foundry that help businesses and organizations implement generative AI at scale. Additionally, AI companies like OpenAI, DeepMind, and Meta, which leverage chips from Nvidia Corporation (NASDAQ:NVDA), are further cementing their strong position in the AI market. The AI leader is at the forefront of GPU technology with continuous innovation. Its upcoming AI factory platform, Blackwell GPU, delivers up to 4x faster training and 30x faster inference than its predecessors.
In its Q2 2024 investor letter, Patient Capital Opportunity Equity Strategy said:
“NVIDIA Corporation (NASDAQ:NVDA) continued to lead both the market and the portfolio, remaining a top performer in the period, gaining 36.7%. Nvidia is the market leader in the design and sale of Graphics Processing Units (GPU), which has recently benefited from the insatiable demand for artificial intelligence (AI) models. While we expect competition to intensify, we believe NVDA can continue to hold its majority market share. While many are concerned about backlog reduction, we believe the rollout of the B100 (Backwell GPU), which promises 2.5x performance improvement at only 25% higher cost, will create more backlog later this year. With leading technology, an increasing innovation cycle, and strong cash generation, the company is well-positioned for the increased adoption of artificial intelligence (AI).”
Nvidia Corporation (NASDAQ:NVDA) has delivered strong financial performance over the past decade, with annual revenue growth of over 20%. In the first quarter, the company posted a record-high 262% year-over-year increase in revenue, which amounted to $26 billion. The company also posted 392% growth in earnings, which amounted to $0.61 per share. By ending the quarter with strong free cash flow, the company demonstrated its ability to leverage its position to generate significant financial gains.
Nvidia Corporation (NASDAQ:NVDA) is poised to capitalize on several growth opportunities in the future. The automotive sector is expected to become the largest vertical, fueled by an increase in demand for AI in autonomous driving technology. Additionally, the ever-evolving consumer internet sector presents a significant growth opportunity as it relies heavily on Nvidia’s AI assistant technology. With generative AI gaining traction as one of the biggest technology trends, the company can expect continued growth opportunities in the consumer internet sector. Over the past four quarters, nearly 40% of its data center revenue was driven by inference. The increasing inference along with user growth is expected to drive demand for advanced generative AI technology, making NVIDIA Corporation (NASDAQ:NVDA) a market leader.
Now let's look at the 20 most developed countries in the world.
Photo by Jacek Dylag on Unsplash
Methodology
To compile our list of the world’s most advanced countries, we consulted our article on the countries that spend the most on research and development and selected the top 30 countries based on absolute R&D spending (estimated using R&D as a percentage of 2021 GDP data). We then used their Human Development Index (HDI) scores, which measure a country’s overall development across key dimensions such as life expectancy, education, and per capita income. We then assigned 70% and 30% scores to both our R&D spending and HDI rankings and calculated an average for each country. Finally, we listed the countries in descending order of the composite ranking.
Please note: We have excluded Israel from our list, despite its high R&D spending. This is due to the ongoing war in the Middle East, which is hindering economic development and progress.
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The most advanced country in the world
1. Germany
Absolute R&D expenditure: $134.45 billion
Human Development Index: 0.950
Composite ranking: 4.6
Germany is the most advanced country in the world. In 2021, it spent an estimated $134.45 billion on research and development. The technology sector is a major driver of Germany’s economy, providing over one million jobs and generating over €230 billion in revenue. The sector has over 100,000 companies. It accounts for around 7% of Germany’s total economic output. The country also offers a high standard of living, as evidenced by its HDI score of 0.950.
Curious about other developed countries? Check out our report on the 20 most developed countries in the world.
At Insider Monkey, we cover a variety of topics, but our expertise lies in identifying the best performing stocks. Currently, artificial intelligence (AI) technology is one of the most promising areas. If you're looking for an AI stock that shows more promise than NVDA but trades at less than 5x earnings, check out our report on the cheapest AI stocks.
READ ALSO: Analyst Sees New $25 Billion 'Opportunity' for NVIDIA And Jim Cramer Recommends These 10 Stocks in June.
Disclosure: None. This article was originally published on Insider monkey.
