America’s GDP is still roughly twice as big as China’s (using market exchange rates). To predict when the gap might be closed, The Economist has updated its interactive chart below with the latest GDP numbers. This allows you to plug in your own assumptions about real GDP growth in China and America, inflation rates and the yuan’s exchange rate against the dollar. [Plugging in our assumptive] numbers China will overtake America in 2018. [Share your prediction in the “Comments” section at the bottom of the page.]
So say edited excerpts from an article written by The Economist Online.
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The article is quoted in its entirety below:
“Over the past ten years, real GDP growth averaged 10.5% a year in China and 1.6% in America; inflation (as measured by the GDP deflator) averaged 4.3% and 2.2% respectively. Since Beijing scrapped its dollar peg in 2005, the yuan has risen by an annual average of just over 4%. Our best guess for the next decade is that annual GDP growth averages 7.75% in China and 2.5% in America, inflation rates average 4% and 1.5%, and the yuan appreciates by 3% a year. Plug in these numbers [go here to use the interactive chart] and China will overtake America in 2018. Alternatively, if China’s real growth rate slows to an average of only 5%, then (leaving the other assumptions unchanged) it would not become number one until 2021. What do you think? [Share your prediction in the “Comments” section at the bottom of the page.]
A broader analysis by The Economist finds that China has already overtaken America on well over half of 21 different indicators, including manufacturing output, exports and fixed investment. The chart below predicts when China will surpass America on the rest. By 2014, for example, it could be the world’s biggest importer and have the largest retail sales. America still tops a few league tables by a wider margin. Its stockmarket capitalisation is four times bigger than China’s, and it spends five times as much on defence. Even though China’s defence budget is growing faster, on recent growth rates America’s will remain larger until 2025.”
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Editor’s Note: The author’s views and conclusions are unaltered and no personal comments have been included to maintain the integrity of the original article. Furthermore, the views, conclusions and any recommendations offered in this article are not to be construed as an endorsement of such by the editor.
The Brookings Institute has released an interactive map showing economic growth data (real GDP per capita and employment change) for the largest 300 metropolitan areas in the world for three periods.and ranks each accordingly. How does your city compare? Take a look.
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