- Helen Qiao of Bank of America told CNBC that China could double the size of its economy by 2035.
- The economist warned that US-China relations could cause problems, as well as the aging of the Chinese population.
- Qiao and the Center for Economics and Business Research have said China will overtake the United States by 2028.
Experts have long wondered when the Chinese economy will overtake the United States and claim first place as the world’s largest economy.
In 2010, China overtook Japan to become the second largest economy, according to The Guardian.
In 2020, the country overtook the United States to become the European Union’s largest trading partner, as reported by the BBC.
Speaking to CNBC, Helen Qiao, head of the Asian economy at Bank of America Global Research, said China could double the size of its economy by 2035 and overtake the United States at some point between 2027 and 2028.
“Last year, China was one of the only major economies to record positive GDP growth,” Qiao said. “And this year, we expect China to achieve 8.5% GDP growth as well. “
Qiao’s figures are corroborated by the Center for Economics and Business Research, which released a report in December saying China would overtake the United States in 2028.
A Reuters report said the think tank believed it would happen five years earlier than expected due to the pandemic.
Despite the coronavirus pandemic, the Chinese economy experienced 2.3% GDP growth in 2020 and last quarter growth of 6.5%.
This successful year comes after a 6.8% contraction in the first quarter, the country’s first in 28 years.
By October, it had rebounded, with 637 million people traveling across the country to celebrate Golden Week, one of China’s biggest holidays. Meanwhile, the United States has largely sacrificed Thanksgiving festivities in the name of public safety.
Qiao warned that U.S.-China relations could deteriorate further in the future, hurting China’s growth, and stressed the need for collaboration to reduce China’s environmental impact.
The economist also highlighted several risk factors, including China’s aging population, its investment-driven growth model and high levels of debt relative to its GDP.
Experts told Business Insider US in July that China’s actual output potential was much higher than that of other economies, at around 6%. However, their predictions of economic contraction ultimately did not turn out to be true.
According to the International Monetary Fund, China overtook the United States as the world’s largest economy in 2014, measured using figures adjusted for purchasing power. However, it still hasn’t overtaken the United States in gross terms.
Standard Chartered Bank data suggests the takeover will take place in 2020, but the United States remains the world’s largest economy.