When will China take the Crown?

[Louis VI the Fat]

You have five more years to learn Mandarin.

Will China take the crown?

Angus Maddison's forecast (which uses purchasing power parity) isn't built on outlandish assumptions. He assumes China's growth will slow way down year by year, and America's will average about 2.6% annually, which seems reasonable. But because China has grown so stupendously during the past decade, it should still be able to take the crown in just seven more years.
If that happens, America will close out a 125-year run as the No. 1 economy. We assumed the title in 1890 from - guess who. Britain? France? No. The world's largest economy until 1890 was China's. That's why Maddison says he expects China to "resume its natural role as the world's largest economy by 2015." That scenario makes sense.



China was the largest economy for centuries because everyone had the same type of economy - subsistence - and so the country with the most people would be economically biggest. Then the Industrial Revolution sent the West on a more prosperous path. Now the world is returning to a common economy, this time technology- and information-based, so once again population triumphs.



http://money.cnn.com/2008/04/29/maga...ion=2008043005

For Americans, 2008 is an important election year. But for much of the world, it is likely to be seen as the year that China moved to center stage, with the Olympics serving as the country's long-awaited coming-out party. The much-heralded advent of China as a global power is no longer a forecast but a reality. On issue after issue, China has become the second most important country on the planet. Consider what's happened already this past year. In 2007 China contributed more to global growth than the United States, the first time another country had done so since at least the 1930s. It also became the world's largest consumer, eclipsing the United States in four of the five basic food, energy and industrial commodities. And a few months ago China surpassed the United States to become the world's leading emitter of CO2. Whether it's trade, global warming, Darfur or North Korea, China has become the new x factor, without which no durable solution is possible.

And yet the Chinese do not quite see themselves this way. Susan Shirk, the author of a recent book about the country, "The Fragile Superpower," tells a revealing tale. Whenever she mentions her title in America, people say to her, "Fragile? China doesn't seem fragile." But in China people say, "Superpower? China isn't a superpower."


In fact it's both, and China's fragility is directly related to its extraordinary rise. Lawrence Summers has recently pointed out that during the Industrial Revolution the average European's living standards rose about 50 percent over the course of his lifetime (then about 40 years). In Asia, principally China, he calculates, the average person's living standards are set to rise by 10,000 percent in one lifetime! The scale and pace of growth in China has been staggering, utterly unprecedented in history—and it has produced equally staggering change. In two decades China has experienced the same degree of industrialization, urbanization and social transformation as Europe did in two centuries.
Recall what China looked like only 30 years ago. It was a devastated country, one of the world's poorest, with a totalitarian state. It was just emerging from Mao Zedong's Cultural Revolution, which had destroyed universities, schools and factories, all to revitalize the revolution. Since then 400 million people have been lifted out of poverty in China—about 75 percent of the world's total poverty reduction over the last century. The country has built new cities and towns, roads and ports, and is planning for the future in impressive detail.


http://www.newsweek.com/id/81588

We are witnesses to one of the biggest events in world history. The full scale of the rise of China ecplises anything that the world has ever seen before. Never have so many people, in such a short amount of time, made so much progress as China has in three decades.

For effect, both artocles above are two years old. Since then, the West has seen its financial system collapse, saved by the biggest loans in the history of mankind. China has been going from strenght to strenght. As have many other emerging economies.

Power has definately shifted from the West to a multipolar world. A decade that began with neo-conservative dreams of using America's unrivalled hegemony to assert and prolong this hegemony, will end up in the history books as the one that saw the definitive end of Western hegemony. Economically and politically. Unfortunately morally too, but not quite culturally.

For once, it is worth stating the obvious: China alone has twice the inhabitants of the EU and the US combined. This will have far-reaching consequences, not all of whom have fully sunk in.
Ninety percent of the world's population does not live in Western countries, and they have awoken.

[Hax]

Soon. Very soon.

And people are still surprised I'm going to study Sinology.

[KukriKhan]

'15 is do-able. Peking demands cash (in Euro's) for the US Bonds they hold, America can't pay, and defaults for the first (and last) time in it's history; leading to a run on the Fed, who has no backup like a regular bank, making the dollar worth less than the 7 cents it costs to print it. The Pension plans and Mutual Funds get 10 cents on the dollar for the Treasuries they hold, and 70-year olds go back to work for companies owned by the PRC People's Army, making crap product to sell to Africans.

And never a shot fired.

[Aemilius Paulus]

Remember how notoriously inaccurate such predictions are. Remember how they screamed that Japan will eclipse the US economy in the 80s. Take into account the similarities between Japan and China. Compare how the things said about Chinese economy now are nearly identical to the statements made about Japan thirty-twenty years ago. Take note of the real estate and stock bubble, that killed Japan, and the worries of the massive Chinese gov't spending which is feared to lead to another bubble.

Now, China could very well avoid the fate of Japan, and it is very unlikely it will fall like that. But still, an export-driven economy is a dangerous thing, as the days of mercantilism have long passed and it is recognised that a balanced economy is superior to the China/Russia/Germany -esque export economies.

Then again, with China's population, it is difficult to imagine any other fate for such a nation... Either a total collapse, or magnificent dominance. In any case, such Louis-esque enthusiastic rhetorical flourish on a certain subject is always to be taken with a grain of salt, no matter how eloquently it is presented, such as in this case.

[Mete Han]

Nevertheless, the future will be multipolared, and don't forget India, they share the same advantages with China, very cheap labor force and no worker rights...

[Meneldil]

Hopefully after my death.

[Samurai Waki]

I'm hoping those Glaciers in the Himalayas melt first... if China really wants to take the stage they're going to have to make sweeping reforms in the actual liberty of it's populace.

[Furunculus]

Hopefully after my death.

agreed.

i voted 2050 because while they will eventually hit top-dog status it will never be as clear-cut or as commanding as that enjoyed by Britain or the US due to the contradicitions of its own demographics.

http://whatmatters.mckinseydigital.c...-china-is-no-1

[Louis VI the Fat]

Remember how notoriously inaccurate such predictions are. Remember how they screamed that Japan will eclipse the US economy in the 80s. Take into account the similarities between Japan and China. Compare how the things said about Chinese economy now are nearly identical to the statements made about Japan thirty-twenty years ago. Take note of the real estate and stock bubble, that killed Japan, and the worries of the massive Chinese gov't spending which is feared to lead to another bubble.

And in 1840, Alexis de Tocqueville made the prediction that the 20th century would see Russia and the US as the two rivalling superpowers.

Some predictions are 'more equal' than equal predictions.

Japan isn't dead. It is alive and kicking, rivalled in living standards by only the best of the west. It merely experienced slumbering growth.
China is also not Japan. Most strikingly, it is ten times its size. Most emerging nations have emerged as part of an existing system. Just how a country that is larger than all other traditional industrialised nations combined can be incorporated within such a system is still a big question. Who will be incorporated into whom? Other emerging markets are only further complicating this question.

As for India - it will grow, but I have less faith in it than in China.

Spoiler Alert, click show to read: 

Chongqing. Most people will have never heard of it. It is a provincial town. It is three times the size of Paris.

This is why our integration into a strong economic relationship with the EU and India while passively undermining China is so important.

I wouldn't be surpised if within our lifetime quarrels between democracies will be looked at with bittersweet nostalgia to a time when we could all afford such luxury.

Spoiler Alert, click show to read: 

P.S. "Will end" ...? The 21st century's first decade ended almost three months ago...

Look, I don't know what kind of dimwits you are accustomed to, but I am getting a bit tired of your constantly adressing me as if I'm one too. Read:

A decade that began with neo-conservative dreams of using America's unrivalled hegemony to assert and prolong this hegemony, will end up in the history books as the one that saw the definitive end of Western hegemony.

[The Wizard]

And in 1840, Alexis de Toqueville made the prediction that the 20th century would see Russia and the US as the two rivalling superpowers.

Some predictions are 'more equal' than equal predictions.

A prediction made under influence of the horribly incorrect theory that big countries naturally get into conflict with each other. De Tocqueville's prediction is basically a lucky guess, which I might add came true due to completely unrelated factors.

Chongqing. Most people will have never heard of it. It is a provincial town. It is three times the size of Paris.

That's mostly because it's also geographically three times the size of Paris. The city itself, with a population of 5 million, is, while large, smaller than Paris. Anyhow, it's also the most important industrial area in China's hinterland, not just some random "provincial town".

Look, I don't know what kind of dimwits you are accustomed to, but I am getting a bit tired of your constantly adressing me as if I'm one too.

Whoa, slow down, sparky. I was merely inquisitive (and failed at communicating that, apparently). Must have misread, my bad

(As an aside, even then it'd be incorrect, seeing as American hegemony had ended long before Bush's election)

[Subotan]

Even if China did surpass the USA as the world's largest economy, it would need to achieve the past 20 years of growth all over again, not once, twice or even three times, but four times to gain comparative per capita income with the United States, and by that time the USA will have grown some more, making the task even harder.

Don't get me wrong, I think what China has experienced is the closest we'll ever come to witnessing a modern day miracle. Considering that consistently, since 1840, China had been repeatedly screwed over by the West, turning it into a nation of heroin addicts, stunting it's population and economic growth (China's population remained at about 400 million from 1800 until the Communist Revolution), and generally just treating it and the Chinese people like ****. For China to have not only shaken off the West, but to have achieved so much, so fast is incredible, and worthy of praise.

[The Wizard]

We are witnesses to one of the biggest events in world history. The full scale of the rise of China ecplises anything that the world has ever seen before. Never have so many people, in such a short amount of time, made so much progress as China has in three decades.

For effect, both artocles above are two years old. Since then, the West has seen its financial system collapse, saved by the biggest loans in the history of mankind. China has been going from strenght to strenght. As have many other emerging economies.

Power has definately shifted from the West to a multipolar world. A decade that began with neo-conservative dreams of using America's unrivalled hegemony to assert and prolong this hegemony, will end up in the history books as the one that saw the definitive end of Western hegemony. Economically and politically. Unfortunately morally too, but not quite culturally.

For once, it is worth stating the obvious: China alone has twice the inhabitants of the EU and the US combined. This will have far-reaching consequences, not all of whom have fully sunk in.
Ninety percent of the world's population does not live in Western countries, and they have awoken.

Yawn. Growth looks cool in the newspaper but China has an immense gap to overcome. China's economy currently is something like a third the size of the U.S.'s (i.e. even less relative to the EU). Given its current growth, it'll achieve economic parity with the United States somewhere in the 2020s. Parity in productivity, military power, technological prowess and cultural importance will be things the Chinese will have to wait on even longer. Neoconservative dreams were unrealistic to begin with (American hegemony was already gone by the time they gained power). Western nations together, meanwhile, still account for more than 40% of world economic output and 95% of defense spending. Chinese economic growth is dependent on Western desire for consumption (scenarios like KukriKhan's are about as likely as the sky falling on our heads), and is fueled for a very sizeable part by Western investment. I might also add we've heard all of this before (the Soviet Union, Japan... hey, where'd they go?).

None of this takes away the fact of rapid Chinese growth (or that of other "Third World" countries). And none of this takes away the fact that, in time, these nations will truly be able to surpass us. But that is a whole lot further away than next year. In addition, far from it being unprecented, once (and still: if) China becomes the largest economy (alongside India, I surmise, something the OP seems to forget), it will merely be restoring the way the world was before the West underwent the Industrial Revolution, and the world's greatest economies resided in South and East Asia.

We aren't gone, people. Far from it. Politically and economically our influence and our power may be declining, yes, but they do so relative to the rest of the world. And that part of the world has so very far to go before they've caught up with us. I'll give it until 2030 before the U.S. has to face meaningful challenges to its position as top baboon on the rock. A rock that the Western monkeys have been ruling for more or less 250 years...

P.S. "Will end" ...? The 21st century's first decade ended almost three months ago...

[Louis VI the Fat]

Are we talking economically or about global dominance?

Which ever you want. And good to see you back!

Aren't both very much connected, as Clinton's statements show?

WASHINGTON, Feb 25 (Reuters) - Secretary of State Hillary Clinton on Thursday said "outrageous" advice from former Federal Reserve Chairman Alan Greenspan helped create record U.S. budget deficits that put national security at risk.

Appearing before congressional panels to defend the State Department's $52.8 billion budget request for 2011, Clinton said the massive U.S. foreign debt had sapped U.S. strength around the world.
"It breaks my heart that 10 years ago we had a balanced budget, that we were on the way of paying down the debt of the United States of America," Clinton said.

[...]

Having to rely on foreign creditors hit "our ability to protect our security, to manage difficult problems and to show the leadership that we deserve," she said.

"The moment of reckoning cannot be put off forever," she said. "I really honestly wish I could turn the clock back."
Though she did not mention it, China's portfolio of some $755 billion in U.S. Treasury bonds has become a concern for some U.S. policymakers. They worry that Beijing's creditor status could create leverage to influence U.S. policy.
http://www.reuters.com/article/idUSN2511749320100225

~~o~~o~~<<oOo>>~~o~~o~~

Chongqing. Most people will have never heard of it. It is a provincial town. It is three times the size of Paris.

That's mostly because it's also geographically three times the size of Paris. The city itself, with a population of 5 million, is, while large, smaller than Paris. Anyhow, it's also the most important industrial area in China's hinterland, not just some random "provincial town".

Well, firstly, Chongqing is mentioned to convey a sense of size, of unparalleled growth of a scale still not fully realised yet. That is the point that is made by the statement. Meaning, context and all that. Here, one would negate the point being made not by saying that Chonqging is an important industrial area, but by saying it isn't.

Random pedantry is not impressive. Rather, it shows inability to distinguish trivialities from what's important, as is the case here. More worryingly, spewing random facts to impress has become sooo obsolote ever since we all got ourselves a wikipedia.

Secondly, if one wants to be pedantic, at least do your homework, eh? Wiki alone does not suffice, one must also understand the random facts one finds on it. The city of Chongqing has three times the inhabitants of the city of Paris. The municipality of Chonqging also has three times the inhabitants of the aire urbane of Paris, or the region of Île-de-France, mostly rural too.


The rest of your post is wrong because the capital of China is Beijing. Which means 'Northern Capital' and has the postal code 100000 - 102629.

And don't call me sparky, small fry.

[Tellos Athenaios]

Well, firstly, Chongqing is

Since times of yore one of the most important cities within the Chinese hinterland. It's municipality appears the size of Belgium. Thus it isn't particularly surprising that it is a large city; moreover it is a bad example to take. Seriously though as of 2006 it was apparently the 10th most desirable city in China to live in: http://www.chinese-culture.net/html/..._in_china.html Although I don't know how reliable the source is; but an interesting tidbit nonetheless.

[Louis VI the Fat]

Since times of yore one of the most important cities within the Chinese hinterland. It's municipality appears the size of Belgium. Thus it isn't particularly surprising that it is a large city; moreover it is a bad example to take. Seriously though as of 2006 it was apparently the 10th most desirable city in China to live in: http://www.chinese-culture.net/html/..._in_china.html Although I don't know how reliable the source is; but an interesting tidbit nonetheless.

No, it isn't surprising it is a large city. Therefore it is a good example, because few in the West will be familiar with even the name of Chonqging.
My irritation is that a thread about the emergence of China and the consequences thereof will devolve into some pointless arguments over whether some city is the exact size of Belgium or of the Czech Republic. That is not important, not relevant, and not at all interesting either.

'China is urbanising at astonishing pace and scale, has vast industrial powerhouses beyond a few export orientated Hong Kong's on the coast'. That is the point. Conveying a sense of scale and enormity.

[Tellos Athenaios]

Okay if your point is "hey look; some of you may never have heard of these but in 50 years time schools around the world will teach Chongqing, Wuhan, Harbin, Nanjing" instead of "Paris, Hannover, Valencia, Brno" in Topography 101 classes: then yes good point.

EDIT: I should probably add that (a) I get a bit tired of these China will Rule and Everyone Will be Chinese: your resistance is futile type of predictions and more importantly that (b) you have picked basically the equivalent of Shanghai as far as Sichuan goes. Perhaps something that in its context is more like Shanghai than Shanghai itself. Sichuan isn't a random backwater province, and never has been. Within Sichuan and South(-West) China in general Chongqing has been very much a center city and region; if not the capital. Much like how Cologne has been *the* German city in West Germany for ages. Thus saying "urbanization is massive, scale is enormous; industrial power is vast in China -- for all this look at Chongqing" is not very interesting or very illuminating.* It is true. It is correct. But the example is not very convincing/illuminating because as far as the city itself goes, it always has been relatively large, industrial, etc. etc. to begin with. Even within Chinese context and proportions. It has seen a steady influx of migrants and businesses during the various 20th century wars in China; during the various revolutions; and now during a phase of over-populous eastern hubs now (Chinese) people no longer consider that the pinnacle of city-life anymore apparently. Why then should it be exemplary of why China will take the Crown in year YUAN?

If it's just "hey look what a big city I found today, I bet you didn't hear about this one before" then as far as points go it's pretty meh.

[KukriKhan]

[QUOTELouis]Ninety percent of the world's population does not live in Western countries, and they have awoken.[/QUOTE]

Ninety is high by about 35%, non?

...scenarios like KukriKhan's are about as likely as the sky falling on our heads

Yes, I was exploring whether it could happen, not that it shall. The sky does occasionally fall on our heads; that said: to quickly switch from western to eastern dominance in the world would require about a dozen factors going wrong for the West, whilst simultaneously those dozen factors all broke favorably for the East. Statistically unlikely... but not impossible.

[Aemilius Paulus]

Depends how you define West. How do you define it?

[ICantSpellDawg]

This is why our integration into a strong economic relationship with the EU and India while passively undermining China is so important.

[Aemilius Paulus]

This is why our integration into a strong economic relationship with the EU and India while passively undermining China is so important.

Yeah, 'cause one Cold War is not enough - the Yanks gotta start a new one

[CrossLOPER]

2015 seems too optimistic.

[spmetla]

I'd say too pessimistic from my American perspective :P