The firm’s report, The World in 2050, forecasts the UK will fall just one place from ninth to tenth in global economy rankings in purchasing power parity (PPP) terms by 2050.

Using GDP at market exchange rates as an alternative measure, PwC reckons the UK could fall from fifth to ninth place by 2050. However, the UK will remain in the top 10 on either measure.

With potential average annual growth of around 1.9%, the UK is projected to be the fastest growing economy in the G7 over the whole period to 2050. The UK’s position is sustained by its relatively larger projected working-age share of the population than in most other advanced economies, although PwC warns this depends on the country remaining open to talented people from around the world after Brexit.

John Hawksworth, chief economist at PwC, said: ‘Our relatively positive long-term growth projection for the UK is due to favourable demographic factors and a relatively flexible economy by European standards. However, developing successful trade and investment links with faster-growing emerging economies will be critical to achieving this, offsetting probable weaker trade links with the EU after Brexit.’

PwC’s analysis shows China has already overtaken the US to become the world’s largest economy in PPP terms and will move further ahead by 2050. India currently stands in third place and is projected to overtake the US by 2050.

Indonesia moves up the rankings to fourth place, overtaking not just Germany and Japan but also Brazil and Russia by 2050. Germany and the UK hold on in the top 10, but France falls to 12th place and Italy to only 21st as it is overtaken by a succession of faster-growing emerging economies like Vietnam.

PwC projects that the world economy will double in size by 2042, growing at an average annual rate of just over 2.5% between 2016 and 2050. Growth is expected to be driven largely by emerging market and developing countries, with the E7 economies of Brazil, China, India, Indonesia, Mexico, Russia and Turkey growing at an annual average rate of 3.5% over the next 34 years, compared to an average of just 1.6% for the advanced G7 nations of the US, Canada, France, Germany, Italy, the UK and Japan.

The E7 could comprise almost 50% of world GDP at PPPs by 2050, while the G7’s share could decline to just over 20%. But PwC says emerging economy growth will also slow down over the period, as these economies mature and the scope for relatively easy ‘catch-up growth’ by importing advanced economy technologies is reduced over time.

Separate research from ICAEW focusing on current conditions, shows that UK business confidence at the start of the year remains static and in negative territory after the political and economic turmoil of 2016.

The  latest ICAEW UK Business Confidence Monitor (BCM) has a confidence index which is still negative, at -8.7 this quarter, compared to – 9.8 in Q4 2016.

The research shows companies are forecasting stronger growth in both domestic and export sales than in recent quarters. But with input costs rising, they are not anticipating that to translate into faster growth in profits

Capital investment has experienced the slowest growth for three years and expectations are slower yet in 2017. The retail and wholesalers and property sectors reported the largest decline in confidence this quarter.

PwC’s report, The long view: how will the global economic order change by 2050? is here.