China is projected to overtake the US to become the world's largest economy as early as 2016, according to a report by the Organization for Economic Co-operation and Development (OECD) released on Friday.
The report, “Looking to 2060: A Global Vision of Long-term Growth”, uses a new model for projecting growth in the 34 OECD member states and the eight major non-OECD G20 economies over the next 50 years.
“The United States is expected to cede its place as the world's largest economy to China, as early as 2016. India’s GDP is also expected to pass that of the United States over the long term,” the report published on Friday said.
China is also expected to surpass the Euro zone in a year or so. Another Asian giant, India, will “surpass Japan in the next year or two and the Euro area in about 20 years.”
By 2025, the combined GDP of China and India will exceed that of the major seven (G7) OECD economies.
“The shifting balance of long-term global output will lead to corresponding improvements in living standards,” the report says.
By 2060, people in the poorest countries will see their income per capita quadruple, and the increase could even be seven-fold in China and India.
However OECD Secretary-General Angel Gurria said, None of these forecasts are set in stone.
We know that bold structural reforms can boost long-term growth and living standards in advanced and emerging-market economies alike.