China to leapfrog US as world’s biggest economy by 2028 – Newspaper

LONDON: China will overtake the United States to become the world’s largest economy in 2028, five years earlier than previously estimated due to the two countries’ contrasting recoveries from the Covid-19 pandemic, an expert group said.

“For some time, a predominant theme of the global economy has been the economic and soft power struggle between the United States and China,” the Center for Business and Economic Research said in an annual report released Saturday.

“The Covid-19 pandemic and the corresponding economic consequences have certainly tilted this rivalry in China’s favor.”

The CEBR said that China’s “skillful management of the pandemic”, with its strict early lockdown and long-term growth impacts in the West, meant that China’s relative economic performance had improved.

China appeared poised for average economic growth of 5.7 percent a year between 2021 and 25 before slowing to 4.5 percent a year between 2026 and 30.

While the United States is likely to have a strong post-pandemic rebound in 2021, its growth would slow to 1.9{74ca91e3bee52d91843c282edd75c0800a88a3d8744a3a1c83b7ba867058fc3c} annually between 2022 and 2024, and then to 1.6{74ca91e3bee52d91843c282edd75c0800a88a3d8744a3a1c83b7ba867058fc3c} after that.

Japan would remain the world’s third-largest economy, in dollar terms, until the early 2030s, when it would be overtaken by India, pushing Germany from fourth to fifth.

The UK, currently the fifth-largest economy by CEBR measure, would slide to sixth place from 2024.

However, despite the impact in 2021 of its exit from the European Union single market, British GDP in dollars was forecast to be 23{74ca91e3bee52d91843c282edd75c0800a88a3d8744a3a1c83b7ba867058fc3c} higher than France’s by 2035, aided by Britain’s leadership in the increasingly important digital economy.

Europe accounted for 19 percent of production in the world’s top 10 economies in 2020, but will fall to 12 percent in 2035, or less if there is a sharp divide between the EU and Britain, the CEBR said.

He also said that the impact of the pandemic on the world economy is likely reflected in higher inflation, not slower growth.

“We see a business cycle with rising interest rates in the mid-2020s,” he said, posing a challenge for governments that have gone into massive debt to finance their response to the Covid-19 crisis.

“But the underlying trends that have accelerated at this point toward a greener, more technology-based world as we move into the 2030s.”

Meanwhile, China lowered the age of criminal responsibility to 12 years for “heinous” crimes such as murder or causing injury leading to death or serious disability by extremely cruel means, China Daily said.

The review was approved by the Standing Committee of the National People’s Congress on Saturday after a third review and will take effect from March 1. It applies to children between the ages of 12 and 14, the state newspaper said.

Children in China between the ages of 14 and 16 can be held criminally responsible if they intentionally commit serious violent crimes such as murder and rape. For most other crimes, the age of criminal responsibility is 16.

Posted in Dawn, Dec 27, 2020