I am willing to make that bet.
For some minor factors in my favor I would want Hong Kong and Macau’s GDP to be included in China’s total. Those territories belong to China. I would also want the most favorable exchange rate in any particular year to be used for the conversion.
A Guardian an article by enthusiastic orientalist Martin Jacques in which he says that The Economist has just predicted that China’s GDP, measured in nominal dollars, will will be the world’s largest by 2018. Earlier estimates, he says had China becoming the largest economy in the world by 2027.
This 2018 prediction deserves I think more than a little questioning — it requires that nominal Chinese GDP growth in dollars outpace nominal US GDP growth by 13% a year. I know that in the past The Economist has tended to be a little less skeptical than some others have been about the sources and components of the Chinese growth miracle (not always — different writers at The Economist seem to have very divergent opinions on the subject), but this is a pretty aggressive prediction, more in line with what I would expect from an investment bank, or from a consulting company that helps foreigners access the Chinese consumer market.
I looked recently at forecasts for China’s provinces and updated the GDP projections.
Year GDP(yuan) GDP growth USD/CNY China GDP China+HK US GDP 2011 47.2 9.2 6.3 7.5 7.8 15.1 2012 53 8.2 6.1 8.7 9.0 15.8 2013 59 8.5 5.8 10.2 10.5 16.5 2014 66 8.5 5.5 11.9 12.2 17.2 2015 73 8.5 5.2 14 14.3 18 2016 80 8 4.9 16.3 16.7 18.8 2017 88 8 4.6 19.1 19.5 19.6 2018 97 8 4.3 22.6 23 20.5 2019 107 8 4.1 26 26.5 21.5 2020 115 7.5 3.9 29.6 30 22.4 2021 125 7.5 3.7 33.7 34.2 23.4 2022 135 7.5 3.5 38.5 39 24.5 2023 145 7 3.3 44 44.5 25.6 2024 157 7 3.1 50.6 51 26.7 2025 170 7 3 56.5 57 27.9 2026 183 7 3 61 61.5 29.2 2027 198 7 3 66 66.4 30.5 2028 214 7 3 71.2 72 31.9 2029 235 7 3 78.4 79 33.3 2030 259 7 3 86.4 87 34.8
If China has more inflation that the United States then the currency conversion will not need to increase as much as in the above chart.
Another factor is what happens with US economic growth.
The US Bureau of Economic analysis has the US 2011 annual GDP at 15.094 trillion. This was a 3.9% increase over 2010 annual GDP. 2.8% GDP growth and 1.1% GDP price index.
The Federal reserve has forecasts for US GDP Growth and inflation
The US is likely to end up in the range of 20.0 trillion to 21.0 trillion. (2.1% GDP to 2.8% GDP average for 2012-2018, with 2.0% GDP price index.
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Brian Wang is a Futurist Thought Leader and a popular Science blogger with 1 million readers per month. His blog Nextbigfuture.com is ranked #1 Science News Blog. It covers many disruptive technology and trends including Space, Robotics, Artificial Intelligence, Medicine, Anti-aging Biotechnology, and Nanotechnology.
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