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China to become largest economy 'in 4 years'

2012-11-12 08:46 Shanghai Daily     Web Editor: qindexing comment

China is expected to become the world's largest economy in four years as the balance of economic power is forecast to shift over the next five decades, the Organization for Economic Co-operation and Development has forecast.

Fast-growing emerging economies will account for an ever-increasing share of global output in the next half century, it said, and China's gross domestic product will surpass the eurozone's this year.

The United States is expected to cede its place as the world's largest economy to China as early as 2016, according to the latest OECD report.

However, analyst John Ross, a visiting professor at Shanghai Jiao Tong University, said it could take a bit longer for China to top the list.

"I think this is a bit exaggerated. It will take five to seven years to happen," he said.

The OECD also said that India's GDP was expected to pass that of the US over the long term. The combined output of China and India would exceed the current Group of Seven economies' GDP by around 2025, and by 2060 it would be more than one and a half times larger, whereas in 2010 China and India accounted for less than half of the G7's output.

The G7 is made up of Canada, France, Germany, Italy, Japan, the UK and the US.

Fast-aging economic heavyweights, such as Japan and the eurozone, will gradually lose ground on the global GDP table to countries with a younger population, such as Indonesia and Brazil, the OECD said.

"The balance of economic power will shift dramatically over the next 50 years in a baseline scenario," Angel Gurria, secretary-general of OECD, said.

"The publishing of the long-term forecast report is a wake-up call as we will face new challenges to ensure a prosperous and sustainable world for all," Gurria said.

The report comes at a time when worries are mounting around the world over the eurozone debt crisis and the American budgetary challenge.

The OECD said that global output would edge up annually by 3 percent in the next half century, mainly driven by productivity improvements and human capital growth, while a great variance between regions and countries was expected.

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