China’s GDP to converge with that of the U.S. within 10 years | Press Release
China’s GDP will converge with that of the U.S. within 10 years
Miguel Sebastián, academic coordinator of GATE Center, moderated yesterday the round table ‘The US-China confrontation and its consequences for Europe and Spain: Technological and business alliances with China’, which was held within the framework of the III Congress Civil Society: Regenerating Spain.
Sebastián presented the results of the Gravity GATE Center index, prepared by the think tank, which shows the progress of the Asian giant’s economy over the last 60 years, which is only 22 points behind that of the United States, both in nominal and real terms.
He affirmed that, in the inevitable conflict between the emerging and declining powers, Europe must be neutral, seeking specific strategic alliances with both, in Africa and Latin America.
Furthermore, he insisted that Europe has to protect its companies from possible cross-sanctions derived from the China-US conflict for world economic hegemony.
Madrid, May 3, 2023
Miguel Sebastián, academic coordinator of GATE Center, moderated last Thursday, April 27th, the round table discussion The US-China confrontation and its consequences for Europe and Spain: Technological and business alliances with China, which was held during the III Civil Society Congress: Regenerating Spain in Madrid. It was attended by important personalities such as Rodrigo Rato, Vice President of the Spanish Government and Minister of Economy between 1996 and 2004 and Managing Director of the IMF between 2004 and 2007; Petra Mateos-Aparicio, Professor of Business Economics and President of Hispasat from 2004 to 2012; Miguel Ángel Fernández-Ordoñez, Governor of the Bank of Spain between 2006 and 2012 and Cristina Manzano, Director of Esglobal.
During his speech, Sebastián, advanced the results of a study that the think tank is working on which reveal that, if it continues to grow at the average rate at which it has been doing so since 2015 (2.1 annual%), the Chinese economy will converge with that of the United States in a period of ten years.
He also presented the conclusions of the Gravity GATE Center index that the think tank produces annually and which shows how over the last 60 years the world’s economic center of gravity has shifted, across the 40th parallel, from the North Atlantic to the Pacific. In terms of weight in the world economy, in 1980 the Asian giant accounted for only 1.7% of world GDP (below even Spain), whereas today the figure has exceeded 18%, i.e. only five points below that of the United States (23%).
Moreover, if we limit the period of analysis to the last three years (2020 – 2022), despite the uncertainty generated by the pandemic and the implementation of the COVID 0 policy, China’s GDP has grown, in cumulative terms, almost nine points more than that of the United States. It should also be recalled that IMF forecasts for 2023 point to an advance of 5.2% for the Asian giant, while that of the United States will be just 1.4%, i.e. almost four points less. “Clearly, the trend is for China’s economy to overtake that of the United States between now and 2033,” said Sebastián, who also explained that the GATE Center is studying the possible technological overtaking of the Asian giant.
China’s economic leadership will produce “a context of confrontation with the US that will undoubtedly have an impact on global trade policy”, explained Sebastián during his introductory speech. In this conflict, which has already begun, and which will have geopolitical, economic and commercial consequences, Europe should be neutral and seek strategic alliances with both powers in areas of mutual interest, such as Africa and Latin America. In addition, he insisted on the idea that “Europe must protect its companies from possible cross-sanctions” resulting from this conflict in which world economic hegemony is at stake.
He also explained that this change of leadership opens up important opportunities for the development of the European economy and industry. However, taking advantage of these opportunities “requires Europe to maintain a neutral position in the conflict between the two powers”, he explained. He also wished to point out that, for some years now, China has been taking advantage of the opportunities opened up by the development of infrastructures in Africa and Latin America, two regions that must form part of the economic and development agenda of the European Union, which must design a common strategy in which the Asian giant establishes itself as a preferential trading partner for both regions.
About GATE Center – An open door to dialogue and cooperation
GATE Center is a non-profit organization, a space for reflection and analysis whose mission is to study global and emerging trends in the economy, the social sphere, technology and their impact on the international political order. It seeks to contribute to the understanding of the changes that will determine this century.
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Beatriz Triper: + 34 622 259 521 // +34 607 75 82 53