Will Chinas economy surpass US?
The economy of the United States is around 10-15 times larger than the economy of Japan, which was just surpassed by China to become number 2 in the world. The U.S. economy is still growing, while the Chinese economy, also growing, has slowed down. There was some worry in the 90s that Japan would exceed the United States, but that never happened. I just don’t think it will happen. Events occur all the time that throw off predictions.
If things remain the way they are, it will surely surpass the US. Why? i. Exports. China’s exports keep increasing everyday. This creates a big enough base for its labor force to be employed and earns more money through the exports to other countries. More over, China has low costs of production unlike the USA. Labour in China is cheap, partly because labour rights are over-looked, people work in bad conditions such that when compared to USA, to produce an equal amount of goods, USA companies will spend more on production including but not limited to good environment for workers, high wages, health policies, etc. This puts American companies on a disadvantage. That’s why more and more manufacturing plants are being setup in China ii. Unfair exchange rate. The fact that China is commandist in Nature, means it has a central planning authority which determines the exchange rate. USA depends largely on market forces to determine the exchange rate. This makes Chinese goods cheaper than the
