China to dethrone US as world’s biggest economy this year

1st May 2014 | By Mouseworld Now Correspondent |

Chinese-DragonNew Delhi, 1st May, 2014: US economy was almost double the size of China’s in 2012. As per one estimate at a common price level, The dragon will outperform the US to claim the honour of the world’s largest economy this year, much ahead of the previously predicted 2019.

 

Estimated as per purchasing power parity (PPP), China’s economy was 87% of the US in 2011, up from 45% in 2005, as per the 2011 Round of the World Bank’s International Comparison Program (ICP) released recently.

 

The Chinese economy grew 24% between 2011 and 2014, compared to 7.6% growth of the US economy during the period. The world economy’s reorganisation aided by rapid strides by emerging and developing countries. India zoomed past Japan and seven other Top economies to be the third largest economy in terms of PPP in 2011. Only the US and China were ahead of India. India’s economy was 37% of US’ on a PPP basis, a great improvement from 18.9% in 2005, says a World Bank-ICP report.

 

 

“The six largest middle-income economies — China, India, Russia, Brazil, Indonesia and Mexico — account for 32.3% of world GDP, whereas the six largest high-income economies — US, Japan, Germany, France, United Kingdom, and Italy — account for 32.9%,” the report said.

 

The investment expenditure figures put out by ICP clearly indicate that the balance of economic power could tilt more decisively in favour of countries in the Asia and the Pacific region. “At 27%, China now has the largest share of the world’s expenditure for investment (gross fixed capital formation); followed by the US at 13%. India, Japan and Indonesia follow with 7%, 4% and 3%, respectively,” says the report.

The International Monetary Fund has estimated the US GDP in 2012 at $16.2 trillion and China’s at $8.2

 

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