This article was originally published on ETFTrends.com.
Eight billion.
That’s what the global population is expected to reach in November, for the first time ever. Even as birth rates are retreating worldwide, couples continue to have babies, and later this year we will be sharing the planet with 8 billion fellow humans, according to a new report by the United Nations Population Fund (UNFPA).
This incredible milestone underscores the need to solve a number of ongoing challenges related to population growth, but it also presents what I believe are some very attractive investment opportunities. Depending on the country, every new baby requires additional amounts of commodities and raw materials, from aluminum to zinc.
And with the size of the global middle class expanding rapidly, demand for new materials should remain high going forward. This favors exploration and production companies in particular, but it’s also good news for companies involved in food and beverages, pharmaceuticals, health care, luxury goods, transportation and much more.
India’s Population To Surpass That Of China
Among the fastest growing countries on earth, in population terms, are emerging economies such as China and India, or “Chindia,” home to a combined 2.8 billion people.
China has long been the world’s most populous country, but this decade—perhaps as soon as next year—India is projected to surpass its northern neighbor. According to the UN, India is among a group of eight countries that will contribute more than half to the world’s total population growth from now until 2050, the others being the Democratic Republic of the Congo, Egypt, Ethiopia, Nigeria, Pakistan, the Philippines and Tanzania. In the chart below, I include the U.S. for comparison’s sake.
That high population growth has shifted to emerging and developing economies shouldn’t surprise anyone. Globally, birth rates are the lowest they’ve been since the 1950s, with fewer and fewer countries producing more than 2.1 babies per woman, which is considered to be the “replacement rate.” The U.S., for instance, has been steadily creeping below this rate for the past 15 years, and in 2020, it hit an all-time low of 1.6 births per woman, likely due in large part to the pandemic.
The provisional data for 2021 shows that the number of U.S. births increased slightly from the prior year, but it’s still well below the replacement level, despite the reproductive efforts of Elon Musk. (The Tesla and SpaceX chief has called population collapse the number one problem facing civilization.)