A few days have past since my last post – I’ve been on holiday where there was no Internet access. Here is an interesting gaphic from The Economist where you can input data into their interactive chart to predict when China will overtake the USA as the world’s major economy. Click here to go to the page on The Economist site.
Our best guess for the next decade is that annual real 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 and China will overtake America in 2019. But if China’s real growth rate slows to an annual average of only 5%, then (leaving the other assumptions unchanged) China would become number one in 2022. Please place your own bets.