The World's Shadow Economy is Worth $12.5T 🕵️‍♂️

Key Takeaways

• The value of the global shadow economy is estimated to equal 11.8% of GDP based on analysis of 131 countries by Ernst & Young.
• In about half of the countries analyzed, the shadow economy is equal to 19% of GDP.
• Across 119 countries, the size of their shadow economy declined between 2000 and 2023, with the greatest reductions seen in low-income countries.

The Scale of the Underground Economy

The shadow economy represents unreported business activity, spanning from illegal enterprises to cash transactions hidden from government's view.

These activities make up the highest share of GDP across Eastern Africa (41.6% of GDP) and the lowest share in North America (5% of GDP).

Overall, Sierra Leone has the largest shadow economy as a share of GDP, at 64.5%, while the UAE has among the lowest, at 2.1%.