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December 31, 2011

Economist magazine predicts that China's economy will pass the US economy in 2018

The Economist magazine forecasts that China economy at market rates will pass the US economy in 2018

They also predict

2020 for China stock markets to exceed the valuation of US stock markets
2023 for China consumer spending to pass the US
2025 for China defense spending to pass the US




Nextbigfuture has been predicting for several years the China would pass the US economy in market rates in the 2016 to 2018 timeframe.

Nextbigfuture also has predicted a similar timeframe to the Economist for the military spending budgets. US defense budgets will likely slow their growth in the future with a weaker economy.

The official defense budget omits a lot of defense- related expenditures, including acquisition of foreign weapons, much defense-related R&D, pensions, and support provided to the military by local authorities,” said Phillip C. Saunders, a research fellow at the National Defense University’s Institute for National Strategic Studies in Washington. “As a result, it significantly understates actual defense spending.”

Defense spending accounts for less than 2 percent of China’s gross domestic product, compared with almost 5 percent in the U.S. China’s defense spending increased an average of 16.2 percent a year from 1999 to 2008, according to figures from a defense white paper published in 2009. The biggest increase was 20.4 percent in 2006.

I had previously tried to project the future defence budgets for China and the United States from 2009-2040

Estimate of Defence Budgets for China and the USA in Billions


Official Defence Budget Forecast Based on Fixed Percent of GDP


GDP Forecasts in Trillions of US Dollars


More and more predictions on when China will pass the US are getting into alignment to what I have been predicting publicly for a few years. Obviously if I am right then the predictions for 2050, 2040, 2030 are moved closer to what is actually happening.

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