What do people think when they think about the richest countries in the world? And what comes to mind when they think about the smallest nations in the world?
Some tiny and rich countries—like Luxembourg, Singapore, and Hong Kong—benefit from having sophisticated financial sectors and tax regimes that help attract foreign investments and professional talent.
But what do we mean when we say a country is “rich,” especially in an era of growing income inequality between the rich and everyone else? While gross domestic product (GDP) measures the value of all goods and services produced in a nation, dividing this output by the number of full-time residents is a better way of determining how rich or poor one country's population is relative to another's.
1. Luxembourg
It would be a pity, though: situated at the very heart of Europe, this nation of about 625,000 has plenty to offer, both to its tourists and its citizens. You can visit Luxembourg for its castles and beautiful countryside, its cultural festivals or gastronomic specialties. Or you could just set up an offshore account through one of its banks and never set foot again, as many do., ns.
Luxembourg uses a large share of its wealth to deliver better housing, healthcare, and education to its people, who by far enjoy the highest standard of living in the Eurozone.
2. Singapore
With an estimated net worth of $23 billion, restaurateur Zhang Yong is the richest person living in Singapore; the 93-year-old Goh Cheng Liang, the founder of one of the world’s largest paint manufacture, is a close second with his $21.7 billion fortune.
In third place with assets of about $15 billion (to some people's surprise) is Eduardo Saverin, the co-founder of Facebook, who in 2011 left the U.S. with 53 million shares of the company and became a permanent resident of the island nation.
But how did Singapore become so prosperous?
With virtually no natural resources, Singapore pulled itself up by its bootstraps through hard work and smart policy, becoming one of the most business-friendly places in the world. Today, Singapore is a thriving trade, manufacturing, and financial hub (most importantly, 98% of the adult population is now literate). That is not as saying that it has been immune from the effects of the global downturn: in 2020, the economy plummeted a record 5.4%, knocking the country into recession for the first time in more than a decade.
3. Ireland
Until recently, Ireland seemed unstoppable. While the rest of Europe was facing all sorts of uncertainties (Brexit, trade tensions with the U.S., refugee and migrant crises, to name a few), the Irish economy just kept humming along: in 2019, while the Eurozone grew only 1.2%, it expanded by over 5.9%, consolidating its role as the fastest-growing country on the continent.
That all changed in 2020: economic growth more than halved from the previous levels, although it is expected to rebound nicely this year.
4. Qatar
It’s not only the oversupply and demand crisis of last year and the exacerbating effect of COVID-19: oil prices have been in steady and sometimes dramatic decline since the mid-2010s. The per-capita GDP of a Qatari citizen was over $143,222 in 2014, it was “just” $97,846 a year later, and nowadays, it is even lower than that.
Still, the country’s oil, gas and petrochemical reserves are so large, and its population so small—just 2.8 million—that this marvel of ultramodern architecture, luxury shopping malls, and fine cuisine has managed to top the list of the world's richest nations for 20 years.
Even so, the economy has shown a certain resilience (it contracted by a relatively modest 2.6% in 2020) and is now projected to rebound amid a rise in gas production and investment in preparation for the 2022 World Cup.
5. Switzerland
Is it really a surprise that Switzerland has the highest density of millionaires in the world? According to the most recent estimates, for every 100,000 residents, there are 9,428 of them (billionaires included)—11.8% of the total considering just the adult population.
However, all that money could not shield the Swiss economy from the effects of Covid-19: in 2020, production declined by 2.9%. Yet, things could also have been worse, especially when we consider that in Italy, Spain, France, and Germany, the contraction has been respectively of 8.8%, 10.9%, 8.2%, and 4.9%.
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