AFP – China could overtake the United States to become the world’s largest economy as early as 2020, a top business consultancy said on Thursday, underlining the “seismic change” in global economic power.
PriceWaterhouseCoopers (PWC) also said in its report that by 2030 the top 10 world economies could be China, followed by the United States, India, Japan, Brazil, Russia, Germany, Mexico, France and Britain.
The current 10 largest economies, according to 2008 data from the International Monetary Fund, are the United States, Japan, China, Germany, France, Britain, Italy, Russia, Spain and Brazil.
“These projects suggest that China could be the largest economy in the world as early as 2020 and is likely to be some way ahead of the US by 2030,” John Hawksworth, head of macroeconomics at PWC, said in the report.
“India could grow even faster than China after 2020, however, and will also move rapidly up the global GDP (gross domestic product) rankings” because of its younger and faster growing population as opposed to China, he added.
The report also pointed to an increasing share of global GDP taken up by China and India, compared to the United States and the European Union.
The proportion in 2010 will be 20 percent for the US, 21 percent for the EU, 13 percent for China and five percent for India, PWC said.
But by 2030 that will have changed to 16 percent for the US, 15 percent for the EU, 19 percent for China and nine percent for India, it added.
Jim O’Neill, chief global economist for US investment bank Goldman Sachs, forecast last November that China will overtake the United States by 2027 — 14 years earlier than a previous Goldman Sachs forecast of 2041 made in 2003.
O’Neill coined the term “BRICs” to refer to the four emerging market powerhouses Brazil, Russia, India and China, which have since formed an informal grouping to discuss global issues and economic policies.
The Group of 20 (G20) developed and emerging economies last year took over from the traditional Group of Seven (G7) — Britain, Canada, France, Germany, Italy, Japan and the United States — as the main forum for economic talks.