ECONOMY | It's More Prosperous in the Philippines ... soon.

LONDON Jan 11 (Reuters) - The Philippines and Peru will be among emerging economies that become much more prominent in the next few decades, helped by demographics and rising education standards, with the Philippines set to leapfrog 27 places to become the 16th largest economy by 2050, HSBC predicts.

The bank expects China to overtake the United States as the world's biggest economy by 2050, and says strong growth rates in other developing countries will help drive the global economy.

"Plenty of places in the world look set to deliver very strong rates of growth. But they are not in the developed world, which faces both structural and cyclical headwinds. They are in the emerging world," the bank said in its report 'The World in 2050'.

It based its forecasts on fundamentals such as current income per capita, rule of law, democracy, education levels and demographic change.

HSBC projects the Philippines economy is poised to grow by an average of 7 percent annually over the next 40 years, while Peru should average annual growth of 5.5 percent over the same period.

The sheer pace of population growth in countries such as Nigeria and Pakistan means that these economies will swell in size to be included among the 100 biggest economies even if their incomes on a per-capita basis remain low.

HSBC said lower scores for rule of law in Latin America constrained its per-capita inccome projections for the region though it noted that Brazil was making headway in this aspect.

"The losers are the small population, ageing economies of Europe," added the bank, which says the demographics in much of Europe underscores concerns about the debt problems faced by many of the continent's governments.