China is now expected to overtake the United States as the world's largest economy in 2028, but its citizens will remain poorer than Americans for the next 50 years or more.
Measured by gross domestic product (GDP) per capita, the U.S. will remain wealthier than China, contends Simon Baptist, global chief economist at the Economist Intelligence Unit. GDP per capita measures an economy's output per person and is the most commonly used indicator of national prosperity.
In its updated 2020 list of world countries ranked by GDP per capita, the International Monetary Fund has the U.S. as the seventh richest country at $63,051 per person while China is down at 108th place at only $10,582 per person. There are 186 countries on the IMF list.
The Central Intelligence Agency ranks the U.S. number 13 and China number 82 based on 2017 data.
"I think it's very unlikely that ... China will get to U.S. levels of GDP per capita -- that's our measure of wealth -- for at least the next 50 years if ever," argues Baptist.
Baptist said China would become "the other very large power" alongside the U.S. on the global stage. Whichever of the two will become more powerful depends on where they wield that power, he noted.
"I think in Asia, it probably will be very difficult for the U.S. to remain the most powerful country through the 2030s, but they're going to remain evenly matched for quite a long time," said Baptist.
The Chinese economy is now projected to overtake the U.S. in nominal U.S. dollar terms by 2028, according to the Center for Economics and Business Research, an independent economic forecasting and analysis firm based in the United Kingdom. CEBR originally projected China to become number one by 2033.
It upgraded China's ascendancy to the top spot due to China's skillful management COVID-19 pandemic. This success will serve to boost China's relative growth compared to the U.S. and Europe in coming years.
On the other hand, CEBR also said the average Chinese will remain far poorer in financial terms than the average American even after China becomes the world's biggest economy because China's population (1.4 billion) is four times larger than the U.S. (330 million).
CEBR said China controlled the pandemic through swift and extremely strict action, and didn't need to repeat economically paralyzing lockdowns as The U.S. and many European countries have done.
As a consequence, China avoided an economic recession in 2020 and is estimated to see growth this year. In contrast, the U.S. remains mired in a recession.
