This includes the cost of social care, unpaid care by relatives and the medical bills for treating dementia.
The figure is expected to rise rapidly in the coming years but governments are woefully unprepared to meet the challenge, said the World Alzheimer Report 2010.
Experts at the Karolinska Institute in Sweden and King's College London examined the cost of dementia care and found that, if it was a country, it would be the world's 18th biggest economy.
And if it was a company, it would be the world's biggest by annual revenue, way above Wal-Mart (US$414 billion or £265.6 billion) and Exxon Mobil (US$311 billion or £200 billion).
Campaigners have already warned that the costs of caring for people with dementia are on the rise, mostly due to people living longer.
The number of people with dementia will double by 2030, and more than triple by 2050.
An estimated 35.6 million people currently have dementia worldwide, increasing to 65.7 million by 2030 and 115.4 million by 2050.
The study said the costs will rise even faster than prevalence of the disease and, worldwide, there could be an 85% increase in costs by 2030.
In the UK, the Alzheimer's Society has estimated dementia currently costs the country £20 billion a year.