China’s Economy Moves Up To Second Place

China has been growing in the past decade, which as allowed it to surpass Japan’s economy, and reintroduce itself as a large player in the global economy of commercial and political powers. The Associated Press reports:

China has eclipsed Japan as the world’s second-biggest economy after three decades of blistering growth that put overtaking the U.S. in reach within 10 years.

Japan is still far richer per person after confirming Monday that economic output fell behind its giant neighbor for the three months ending June 30. However, the news is more proof of China’s arrival as a force that is altering the global balance of commercial, political and military power.

Analysts are already looking ahead to when China might match the United States in total output — which the World Bank and others say could be no more than a decade away.

“This means the world will pay more attention to China, especially when most Western countries are mired in the bog of debt problems,” said economist Lu Zhengwei at Industrial Bank in Shanghai.

Unseating Japan — after earlier passing Germany, France and Britain — caps three decades of breakneck growth that has cemented a dramatic change in China’s place in the world over just the past five years.

State-owned Chinese companies have emerged as major resource investors, pouring billions of dollars into mines and oil fields from Latin America to Iraq. Chinese pressure helped to win a bigger voice for developing economies in the World Bank and other global institutions.

On a human level, China’s rise has allowed hundreds of millions of people to work their way out of poverty and sent a flood of students and tourists to the West. Its consumers are so avidly courted that companies from Detroit automakers to French handbag producers now design goods to suit them.

Still, China’s rise has produced glaring contradictions. The wealth gap between an elite who profited most from three decades of reform and its poor majority is so extreme that China has dozens of billionaires, while average income for the rest of its 1.3 billion people is among the world’s lowest.

By contrast, Japan’s people still are among the world’s richest, with a per capita income of $37,800 last year, compared with China’s $3,600. So are Americans at $42,240, their economy still by far the world’s biggest.

Continues at AP News:

7 Comments on "China’s Economy Moves Up To Second Place"

  1. Liam_McGonagle | Aug 16, 2010 at 6:36 pm |

    Interesting, no doubt. And no surprise, either. But what I think needs to be explored more are the complexities and cleavages within Chinese society. I've had occassion to work very closely with several very impressive individual Chinese persons in my business career. And those anecdotal discussions portrayed to me a giant that may be just as vulnerable as it is massive. Why don't we hear more of that?

    • Hadrian999 | Aug 17, 2010 at 1:22 am |

      most economies are vulnerable do to being tied closely to other economies,
      people don't like to talk about that because it scares people to think that if any of the big economies really tank it'll drag all the others down too.

      • The Australian economy is very closely linked to China. Their massive demand for mineral resources and Australia's abundance of everything from coal to uranium is the main reason that the Australian economy has come through the GFC relatively unscathed.

        What would happen if these resources were suddenly unavailable to China? And without the continued mining boom Australia would be in serious economic trouble. Tenuous.

        • Hadrian999 | Aug 17, 2010 at 5:21 am |

          thats the thing, lots of economies are like that.
          imagine what would happen to high end lifestyle goods in the us if
          low priced chinese goods were suddenly unavailable, budgets get tight and suddenly less peoplecant afford the new smartphone, mp3 player or flat screen tv, economies are so closely linked today id something really hits hard somewhere it's likely that several nations could go down the tubes

          • The average chinese person lives a relatively spartan lifestyle compared to us in the West. Most of the stuff that's made there isn't sold there. My wife's brother lives there and visits us once a year and usually buys a few items that we import from China but he can't buy in Beijing

            I think that's bizarre

  2. We’re all wearing Commie pants now…. Literally. Levi’s – not made in America anymore.

  3. We're all wearing Commie pants now…. Literally. Levi's – not made in America anymore.

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