Financial TimesFinancial Times

We shouldn’t call ‘peak China’ just yet

By Martin Wolf

19 Sep 2023 · 4 min read

What is the economic future of China? Will it become a high-income economy and so, inevitably, the largest in the world for an extended period, or will it be stuck in the “middle income” trap, with growth comparable to that of the US? This is a vital question for the future of the world economy. It is also no less vital for the future of global politics.

The implications can be seen in quite a simple way. According to the IMF, China’s gross domestic product per head (measured at purchasing power) was 28 per cent of US levels in 2022. This is almost exactly half of Poland’s relative GDP per head. It also ranks China’s GDP per head 76th in the world, between Antigua and Barbuda, above, and Thailand, below. Yet, despite its relative poverty, China’s GDP (measured in this way) is the largest in the world. Now, suppose its relative GDP per head doubled, to match Poland’s. Then its GDP would be more than double that of the US and bigger than that of the US and EU together.

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