Britain has lost its spot as the world's sixth-largest economy to resource-rich Brazil, according the Centre for Economics and Business Research (CEBR).
The banking crisis of 2008 and the global recession has contributed to the UK being relegated to seventh place in 2011, behind South America's largest economy, which has capitalised on its vast reserves of natural resources and exports to China and the far east.
Brazil's GDP is slated to hit £1,612 billion this year, while the UK's GDP for the year is £1,588 billion.
CEBR chief executive Douglas McWilliams said, "Brazil has beaten the European countries at soccer for a long time, but beating them at economics is a new phenomenon. Our world economic league table shows how the economic map is changing, with Asian countries and commodity-producing economies climbing up the league while we in Europe fall back."
Brazil's huge variety of natural resources that include gold, iron ore, and other minerals as well as its massive off-shore oil, and stable political climate has attracted investors.
Britain on the other hand, is in the midst of a national debt crisis, lack of bank credit and the euro zone debt crisis, has led it to being relegated to the sixth spot.
However, Britain can take some consolation 10 years from now, when it is projected to overtake France to become the world's eighth largest economy, one ahead of France but two behind Brazil.
Currently France is the fifth-largest economy behind the US at number one, followed by China, Japan and Germany.
CEBR predicts that by 2020, India will become the world's fourth largest economy followed by Russia, with Germany being in the seventh spot.
India and Russia will benefit from a surge in growth over the next 10 years said the CEBR, although like most economies, India is trying to cope with high inflation and slowing growth, but it will benefit from growth areas like IT and services to engineering, while Russia will continue to depend on selling oil and gas to Europe and parts of Asia.
According to CEBR's latest forecasts, the world's growth is falling to 2.5 per cent in 2012, with Europe's GDP falling by 0.6 per cent. But if the euro zone debt crisis worsens, CEBR predicts that its growth could fall by up to 2 per cent.
The US will grow at 1.8 per cent, China will slow down to 7.6 per cent, India to 6 per cent, Russia to 2.8 per cent and Brazil 2.5 per cent.