Leaders Say China To Pass US In 2029

This year at Davos I asked people how many years it will take for China to pass the US in gross domestic product. For context, China's GDP in 2010 was $5.7 trillion; the US was at $14.6 trillion. China is growing at 15.3% per year, the US at 3.6%.

Respondents to my question included tech CEOs, a former UK prime minister, a former US senator, and the head of one of the world’s largest banks. I polled entrepreneurs, economists, and businesspeople from many parts of the world. In all, 40 attendees answered the question. Here are the results:
 
1) The average was 18 years -- 2029.
2) Of the 40, only three said that China would never pass the US.
3) The low number of years was eight; the high was 55.
4) Many believed that there would be a political disruption for China, but this would not delay the eventual overtaking of the US.
 
A caveat: The World Economic Forum loves straight lines -- it celebrates stasis and is not adept at predicting disruption. So any so-called obvious trend (e.g., China up, the US flat-lining) is embraced and accepted. Only one problem:  The future rarely cooperates.
 
That said, there is no doubt that the American political system is on trial in the world. A government minister from Singapore bragged to me that the Singapore/China system of "controlled capitalism" was the future -- and that the gridlock in American politics highlights the major flaws in the Western approach. Most disturbingly, I had a few well-known American capitalists opine that perhaps the Chinese had a better "approach" than the US -- that a little less democracy could be better for business than the "messy and divisive" American approach. This is truly the US's "Sputnik moment" as President Obama talked about in his State of the Union speech. The whole world is watching to see if America will rise to the challenge.

Comments

democracy is the worst form of government ...

As Churchill said, democracy is the worst form of government except all those other forms that have been tried from time to time. As a non-US observer, it looks like the US media needs to play its role more effectively if democracy is to function as it should.

US-China

I really don't think that China will eventually surpass the US in 2029. The United States has learnt from it's mistakes, and it's on the path to recovery. I believe China has saturated its growth potential-15.3%. It won't go beyond that, it will come down in the coming years. The US is back to positive growth, and its projected that the growth rate will go up a few notches in the coming years. Also, from a geo-political point of view, a stronger America means a better world. A stronger China means a more dirtier, riskier world. The bottom-line is the US commands more credibility and has more clout in the world than China. That's not going to go away, irrespective of the Chinese growth which is more or less saturated.

understanding the math?

I'm not an economist but if the US has about 300 million people and China has about 1.2 billion (both numbers low but close enough), then to believe that China's economy would never outsize the US' we'd have to believe that GDP per capita in China would never exceed 25% of US GDP per capita. Does it make sense to administrate these two countries of vastly different sizes and with different cultural histories in the same fashion? Historical Chinese political texts have emphasized learning from the outside world what may be applicable locally. It could be that our economy will require more central command or push as we grow more populous.

Hidden Assumption

Your question includes the hidden assumption that China and the US will still be nations.

Which one is more likely to break into pieces in 50 years?

Lifecycle Plays

It is easier for someone to build new things from scratch, while the developed ones have legacy to carry over and have to spend efforts in modernization. The new information era provides opportunities to China, like the electronic era provided good opportunities to US over UK who developed during heavy industry era.

Seeing is believing

It's almost impossible to appreciate what's happening in China without visiting and seeing yourself. And then returning again to do the same.

You can visit any US city and return five years later to find it by and large unchanged. Do the same in almost any Chinese city and you'll often find it hard to get your bearings. Buildings, roads, maglevs seems to mushroom between visits.

There are also telltale qualitative aspects that you pick up from talking to people in China that are as good financial indicators as any of the official figures released. There's a burning energy there that is likely to drive the country forward at a very fast pace for a long time.