If you don't know already. Chinas economy is the worlds second biggest, with a $5.8 trillion gross domestic product that eclipsed Japan in 2010. The big question is will China pass the United States? When?
1. Chinas way to the top Fast Current Long-termChinas economy is the worlds second biggest, with a GDP in trillions, $14.6 growth growth growth not adjusted +11% +10% +7%$5.8 trillion gross domestic product that eclipsed Japan in for ination $55 U.S.2010. Will China pass the United States? When? $5.88There was a similar debate about Japan in the 1980s before Japangrowth stalled after a collapse in that countrys nancial $5.47 Chinaand real estate markets. Japanese growth has remained low 50ever since, an era known as the lost decades. Some analysts 80 90 00 10 Fastregard China as a bubble waiting to burst, and foresee a growth +4%perhaps dramatic slowdown for the country or at least GDP per capita, $47,132 not adjusted U.S. $42,325to much less than the 10 percent growth it registered last for ination 45year. JapanBut there are major di erences between Japan and China perhaps most signicantly their populations. With itswealth spread among roughly 1.4 billion people, per capita China $4,200 Current growth 40income in China remains low at around $4,200 80 90 00 10 +3%representing an immense potential for the country to extenddevelopment to its poorer regions.Does that mean sustained, 10 to 11 percent growth is possible, Long-termor will Chinas expansion slow to a more reasonable rate, growth 35 MORE OF THE SAME +2.5%say, 7 percent or less? As for the United States, its long-term Assuming growthtrend GDP growth is around 2.5 percent. Will that be remains where it was in 2010 in eachsustained going forward? Simply by extending last years country, the linesgrowth rates for the two countries, Chinas economy becomes would cross in 2024. 30the biggest in 2024.Annual GDP growth +7.2% United States +2.9 25 -2.6 +3.8% China +14.2 +9.8 LONG-TERM TREND 20 If the U.S. conforms to its long-term trend of 2.5 80 85 90 95 00 05 10 percent, and China slows to what some estimate is its likely long-term growth rate of around 7 percent, 15 the year would be 2032.GDP in trillions,not adjusted for ination FASTER CHINA If China grows a little 10 United faster and the U.S. slows States to its long-term trend, the U.S. would be number two by 2022. 5 China PROJECTIONS 0 80 85 90 95 00 05 10 15 20 25 30 35 40 44SOURCE: International Monetary Fund ALICIA PARLAPIANO AND HOWARD SCHNEIDER /THE WASHINGTON POST