By Steve Sanduski, CFP®
The world's population is expected to hit 7 billion TODAY, according to the United Nations' population division. That's up from 2.5 billion in 1950. To put 7 billion people in perspective, see if you can correctly answer the following question.
If 7 billion people stood shoulder to shoulder, which of the following geographic areas is the smallest that could accommodate them?
A) Zanzibar (about 650 square miles)
B) Maui (about 727 square miles)
C) Rhode Island (about 1,033 square miles)
D) Sicily (about 9,925 square miles)
E) Cuba (about 42,845 square miles)
F) New Zealand (about 103,733 square miles)
The answer… in a moment.
Here are some interesting facts regarding the rate of growth of the world's population:
250,000 years for the world to reach a population of 1 billion (hit in 1804)
123 years for the next billion (2 billion in 1927)
33 years to reach the next billion (3 billion in 1960)
14 years to reach the next billion (4 billion in 1974)
13 years to reach the next billion (5 billion in 1987)
12 years to reach the next billion (6 billion in 1999)
Sources: Economist, United Nations World Population Prospects: The 2000 Revision, Volume III: Analytical Report
And the growth continues… we're projected to hit 9.3 billion by 2050.
For decades, experts have argued over whether or not our planet can handle this growth. What is not up for debate, though, is the fact that a growing population will affect the demand for goods and services. Food, of course, is high on the list.
The World Bank says, "Between 2005 and 2055 agricultural productivity will have to increase by two-thirds to keep pace with rising population and changing diets." Okay, this is interesting, but why should you pay attention to this type of information?
As a financial advisor, you should monitor trends that could impact the demand for goods and services, which, in turn, may suggest areas ripe (no pun intended!) for investment. By keeping a finger on the pulse of long-term trends — like the rising world population — you can get an early read on investment opportunities that could translate into profits for your clients.
Getting back to the population/geography question, The Economist says the answer is A) Zanzibar.
Does that surprise you?