When Will China Catch Up with the United States?

We all know that China has been growing at an accelerated rate for years, at a velocity that no other country has been able to equal, or even approach. In the last decade it has had an average growth rate of 10.5 percent of GDP and signs indicate that its current growth is around 7.75 percent, while the U.S. economy is expected to grow at an average rate of only 2.5 percent this decade.

Nevertheless, the U.S. economy still represents a quarter of global GDP, while that of China, for all its achievements, is not even half the size of its competitor’s.

The English magazine The Economist reports that China exports 30 percent more and achieves a level of fixed capital investment 40 percent higher than the U.S. China is already the world’s primary manufacturer, it is where the most new cars are sold each year, and, in 2011, it registered the most patents in favor of its residents.

It is clear that China, with more than 1.3 billion inhabitants, is the fastest growing country in the world; thanks to its growth, the world economy maintains hope for recuperation in the middle of a crisis severely affecting the whole of Europe, with unpredictable repercussions.

Our minister for the Economy, Luis Miguel Castilla, has even said that all Peruvians should “light a candle” for China, in the hopes that its economy maintains this rate of imports, avoiding any decline in our exports.

As auspicious as the specialists’ predictions for the economies of Peru, Colombia and Chile into this next decade may be, they are undoubtedly dependent on the behavior of other economies in this globalized world. The general resurgence of the Asian economies over the last decades has, perhaps, not been valued highly enough. Let us not forget the transformation of the so-called Asian tigers (South Korea, Singapore, Malaysia, etc.) in the last fifty years, so much so that they managed to complete the full transition from underdeveloped to fully developed countries.

While the Far East continues its vertiginous progress, the situation is distinct in the Near and Middle East, where wars, violent conflict and internal disorder have slowed economic growth.

Thus, this is a good opportunity for the most modern countries of Latin America to concentrate on their development, think about the opportunities they have in front of them and be sure not to waste them, as has happened before.

Despite the fact that important analysts and serious publications indicate the Chinese economy will overtake that of the U.S. before the end of this decade, the GDP per capita of the North Americans will still, at that point, be four times that of the Chinese, because the population of the U.S. is only 300 million.

Although the Chinese defense budget continues to grow, it is still five times smaller than that of the U.S. Current calculations indicate it won’t be until the middle of the next decade that the defense budgets of both countries reach similar levels. What is certain is that China is a country on the rise, while the U.S. is stagnating economically, with no signs of recuperation.

If this trend continues, before the end of this decade the Chinese economy will overtake that of the United States and the same will happen a few years later in terms of military power. This will convert the Asian country into a future hegemonic power, unseating the United States.

However, one shouldn’t underestimate the northern country’s capacity for reaction: Its decisiveness was demonstrated in the two worldwide conflagrations last century.

Unfortunately, China does not show any advance toward democracy.