1/27/2024 0 Comments Power of ten info![]() The chief executive of the world’s most valuable company, Tim Cook of Apple, took center stage at the China Development Forum in Beijing last month to explain why he has bet his company’s future on China’s continued growth. It is also worth reflecting on the implicit bets that have been made by executives with their companies’ fortunes on the line. My best judgment is that when the books on 2023 are closed, China will have grown more than three times the rate of the U.S. GDP grew at an annual rate of 1.1% last quarter, the Commerce Department said this week. So far these estimates are right on track. economy growing at somewhere between 0.1% and 1.6% this year, and China’s growth as between 4.8% to 6%. Congressional Budget Office, the major investment banks, and most academic economists. The consensus forecast for 2023 includes the International Monetary Fund, the U.S. will not grow half as fast as China this year.īefore putting their money down, however, I suggest those tempted to make such a bet first review the facts. Indeed, I even offered to bet that the U.S. Specifically, I’ve offered bets up to $1,000 on the proposition that in 2023 U.S. is leaving its peers in the dust or are convinced that China is peaking, I suggest they find a colleague and make a bet like the one I’ve proposed to my colleagues at Harvard. will China’s economy grow this year? Twice as fast? Three times the U.S.? More?įor anyone who’s serious about their claims that the U.S. The only question informed analysts and investors are debating is: How much faster than the U.S. And in 2025 and as far beyond that as any eye can see. ![]() They are also expecting it to grow faster than the U.S. Except for a few eccentric academics and editorialists who have been promoting a “peak China” theory, everyone is expecting China’s economy to grow faster than the U.S. and China, analysts who have the best track records are not expecting the U.S. But investors, companies, and countries have to make their best judgements. What will happen in the next three quarters and beyond remains to be seen. Official reports of China’s performance in the first quarter of 2023 were released last week: China grew 4.5% driven by domestic consumption and exports that increased 15%. last year? Whose economy has grown faster than every G7 nation in every year for the past three decades? Who will have the fastest-growing “big economy” in the world this year? when it joined the World Trade Organization at the beginning of this century to three-quarters that of the U.S. Whose economy has risen from one-tenth the size of the U.S. And when we look at the data rather than the declarations, brute facts are hard to deny. But it does create the substructure of power in relations among nations. But the defining challenge of this new world is the rivalry between the U.S. If the only other contenders to shape the 21st-century international order were the six other former great powers of the G7, we could be heartened that the U.S. Today, their seven economies account for just 44% of the global total (30% measured by the purchasing-power parity yardstick that the International Monetary Fund and Central Intelligence Agency use as the best single metric for comparing national economies). While the Global South’s criticism of the G7 as an obsolete, aging, pale club of former imperialists is overblown, the incandescent fact is that since its founding a half century ago, the G7 economies’ share of global gross domestic product has been steadily shrinking. the winner for outrunning other members of the G7 is like awarding an American Olympic sprinter the gold medal by excluding world champion Usain Bolt. is not only ahead but extending its lead. with competitors in the G7: Canada, France, Germany, Italy, Japan, and the U.K. The inconvenient truth, however, is that the Economist reaches this stunning conclusion by excluding the U.S.’s only true peer: China.
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