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China to have world's biggest economy by 2020
Published: 17 August, 2010, 16:31
Edited: 21 August, 2010, 09:43
It has been widely predicted that China's economy will become the largest in the world by the year 2020, overtaking the US.
This week alone the country was said to have surpassed Japan to become the world's second biggest economy in terms of GDP. Earlier this year it officially overtook Germany to become the biggest exporter.
However, Michel Chossudovsky from the Centre for Research of Globalisation in Canada argues that GDP is not representative of the actual strength of an economy, which could mean that China's economy is already the biggest in the world.
“A large share of the commodities that we consume in the US, Canada, Western Europe are made in China,” Chossudovsky said. “The US economy imports cheap at $1. They resell at ten, and the GDP goes up by nine dollars. That is how it works. GDP is not a measurement of productive assets; it is a measurement of value added.”
17.08.2010, 14:09
2 comments
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17.08.2010, 22:37
5 comments
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i would say go china .. but hmmm .. i know that the war and crisis causers will just move to china . buy some share of business there(most probbaly already have done that ) and slowly try and get to the top of the leadership... and in 50 or 60 years we will get another world police super power
The situation may deteriorate in the US more rapidly than some might anticipate. This, for example, what I see from my corner. Let say, you are an American entrepreneur who have some ideas and want to start your high-tech business here, in the US. The biggest challenge you would face today -- to find high-skilled workers. And this is not because they do not exist. The best of them have been employed by "monsters" like Google, Oracle, and so on. And those companies are not willing to let them go and keep them by providing them good compensation and benefits. Another category of high-skilled workers got older and transformed to managers of different ranks and kinds. The third one has retired. The colleges and universities do not supply anymore necessary number of engineers and scientists. And even those there are some who just graduated and appear on the market, they are not necessarily more competitive than their counterparts in China, India, or Eastern Europe. The US government is not supporting American high-tech businesses by limiting number of H1 visas (visa for high-skilled workers) or trying to retain the businesses here (say, by taxation). So, after wandering around for some time and calculating your potential gains and loses, the only choice you have -- to outsource your business in Asia. And this is a big drama for America today. It loses technologies, becomes less competitive. It is no longer an attractive place for ambitious and skillful people from around the world... But, I remember, that Bill Gates already told the same thing to George W.Bush five years ago. So, it may be time for Americans to start learning Chinese, Hindu, and Russian.
Given the state of the worlds economy today, for any one to make such a prognosis for 2020 is unrealistic as in 2020 we may well see a totally different financial world to the one we see today. Wall Street and its financial markets and being the hub of the financial world are slowly fading away, as is the power of the US dollar as the worlds Gold Base for the worlds money systems internationally. During the coming autumn of this year we will see a further erosion in the financial markets of the US and UK and a possible new economic crisis brought about by the idiocy that was conducted when it was thought that by injecting phenominal amounts of money into collapsed, broken and bankrupt banking systems was supposed to give a kick start to an internationally broken financial system. It has not worked. In 2008 they were warned not to do it as it would not fix the problem. Good advice was not taken and bad advice was accepted, from those that created the mess in the first place. The maturity of bonds is coming into being, pension funds are deteriorating and pensions have to be paid out, the unemployment figures are rising, more people are going to lose their homes and find themselves on the street, and the drums of belligerence and war will be ever more louder as the reality bites even harder. Global dislocation has already taken place and is ever more expanding. The one question is this. Who will step forward and allow its currency be used as the new gold standard? The answer. No one. No one will put their nation and people at such risk. Therefore it may occur that nations will come together to create a totally new system of finance together, where no one nation will have the hegemony over any other as is what happened with the US when it took on this role at the Breton Woods accord. Therefore it may be a world totally different to the one we see around us today, and China will be just one nation among many who have a part share in the global economy, US included.