When will China overtake the United States and become the country with the largest economy in the world? – compensate A major issue of the current era is Eric Chu and Tom Orlick, co-authors of the Bloomberg book. This is what businessmen and investors care about, who want to know how to make the most profits, currency traders who scan the dollar exchange rate, and of course the generals who want to prepare for geopolitical struggles.
In Beijing, the Communist Party recently celebrated its 100th birthday. On this occasion, Shen Qing, Chairman of the Party and China, said with confidence that the country’s renewal will continue unabated. In the early stages of the coronavirus epidemic, which the Chinese authorities successfully treated, to ensure the growth of the economy despite the closure, while a severe crisis erupted in the United States in a few weeks, it does not seem that the first man in China is speaking in the air. However, as the US economy has surprisingly found itself in the later stages of the pandemic, China’s trajectory no longer looks so smooth.
In short, if US President Joe Biden can complete his infrastructure reforms and expand the workforce, Bloomberg Economics predicts that China will take over the throne of the world’s largest economy from the United States in 2031 after “sitting” for 100 years. Then. However, this could change as the well-known problems of the Chinese economy, including those caused by trade restrictions or the risks of massive indebtedness, become more severe. Beijing’s nightmare may be that Japan’s fate is due to internal problems المشاكل Come, which seemed to be the United States’ greatest challenge for 40 years, after which – albeit at a high level – economic expansion stalled.
production factors
According to the rule of thumb in economics, by examining the factors of production—labour, capital, and efficiency—we can come closer to exploring the opportunities of the economy. In China, employment has been the driver of development for decades, but now it has acted as a brake. Demographic change reduces the labor supply, and although, for example, a one-size-fits-all policy is abandoned in response, it is doubtful that this will yield results because raising children is not a cheap pleasure. China’s population is expected to shrink by more than 260 million from the current 1.4 billion in three decades.
The outlook for capital isn’t too bad, but after decades of crazy capital investment, we’re seeing a drop in ROI. Ghost towns had grown out of the land, there was a lot of excess capacity in businesses and highways meandered into sparsely populated areas of the country, that is, with nothing. For strategists in Beijing, efficiency, believed to be 50 percent of US productivity, is nothing short of an issue. If all goes well, it could reach 70 percent by 2050.
other factors
In addition, there are also factors unaffected by the communist cadres who proudly stretched out on the centenary of the party’s founding. This is the image and environment of the country’s foreign trade, which has recently deteriorated greatly in the Western world due to violations of human rights and democracy. If this continues like this, it will be a file technology It may lead to a decline in cooperation, as this relationship was one of the most important factors in the growth of previous decades. According to the International Monetary Fund, if the United States and China divided the world into two spheres of influence, they could carve out eight percent of the Chinese economy by 2030, compared to the level it could reach without angry opposition.
More trouble is the country’s indebtedness. Debt has grown at an insane rate relative to GDP, jumping from 140 percent in 2008 to 290 percent now. Not a small part of this resulted from the economic recovery that was introduced in response to the coronavirus pandemic. Such a huge indebtedness would cause huge problems for the middle countries. Bloomberg Economics estimates that a collapse similar to the US bankruptcy of Lehman Brothers in September 2008 – which caused global financial markets to melt – would trigger a severe recession and the loss of an entire decade in China.
And finally, two completely subjective factors can affect the economic competition between the two giants. The first is the unreliability of Chinese statistics. According to Chinese and US researchers, China’s real economic growth between 2010 and 2016 was 1.8 percentage points lower than official data. The other is tangible evidence. President Xi Qingping may be practically at the helm of China for life, but in the first 60 years of the Communist Party’s 100-year history we saw evidence that Mao Zedong’s monopoly made bad decisions impossible to correct.
