4 minute read
President Trump had a lot of angst for China last year, maybe he's cooled off now since meeting President Xi Jinping.
I am on a rigmarole in south East Asia, not yet been to China, but I am on my way there soon, so look out for my exciting travel guides soon.
First stop, Malaysia and what a shocker at the Airport, more evidence of China's now powerful influence. As all steemit community are defacto amateur futurists (crypto currency traders and alternative business enthusiasts) this should interest you.
Arrivals KLIA Malaysia © lordp
Steemit will probably outlive Facebook, and might enjoy a growth explosion in China because of the revenue share model and because it's not presently censored by that government. However, upvote is presently in dollars but this might all soon change?
Here's ten glaring road signs to the inevitable future
China has for long been the world’s largest nation in terms of population. Yet as at 1980, the size of the Chinese economy was a mere $309 billion, as measured at market exchange rates in U.S. dollars. (Less than one thirds of a dollar per person).
That amount was roughly a tenth of what the size of the U.S. economy was in 1980, which was $2.9 trillion. The re-emergence of China as an economic superpower began in the late 1970s (re-emergence because in 1950 just after World War 2 and only a year after the Mao Communist revolution, the Chinese economy was 49% larger than the Japanese economy). By 1977 when leader Deng Xiaoping introduced a series of economic reforms, communism had left the economy in a shambles, the Japanese economy had grown bigger by 63%!
By 2013, the Chinese economy had grown to $16.1 trillion, this is a measure of purchasing power parity... By 2014, the gap between the size of the Chinese and the U.S. economy had shrunk considerably, with China’s economy now reaching $10.4 trillion and the U.S. one $17.4 trillion in GDP.
That same year, 2014, U.S. GDP stood at $16.8 trillion at that time, or just about 4% larger than China’s economy. Currently, the Chinese economy is just 40% smaller than the U.S. when measured at market exchange rates. Even these numbers are not accurate, the Chinese economy is growing faster than projected.
These GDP numbers apply if you measure GDP at market exchange rates by simply converting the value of all goods and services produced in each economy into a single currency (in this case U.S. dollars) using the current exchange rate. However, given China’s higher economic growth rate, at some point during 2014 China overtook the United States as the world’s largest economy when measured on a purchasing power parity.
This should give a decent idea of how large economies are relative to one another, much like how we compare the height of two people by having them stand back to back. Officially, the IMF estimates that China’s GDP at purchasing power parity was $17.6 trillion at the end of 2014 — or lets say about 1% larger than the U.S. GDP of $17.4 trillion.
Measuring GDP at purchasing power parity takes into account the differences in prices that people pay for goods and services in different economies. China’s growth has slowed considerably compared to the 10% annual growth rates of the past few decades. However, first quarter 2017 it was still at an impressive 6.9% growth.
Despite slowdown, it is still expected to maintain a significant growth advantage over industrial advanced economies such as the United States. Since the price level in China is still much lower than in the United States, a dollar in China gets you more stuff than a dollar in the United States.
At the present 2017 pace of growth relative to one another they should be at par by 2026
Chart © Bloomberg
Assuming no significant event (such as military conflict, political revolution or natural disaster) causes either country to deviate from these trajectories, China’s GDP at market exchange rates should overtake U.S. GDP on or before 2028.
Just ten years from today and we will be living in a different world. Facebook is just over ten years old, Steemit is barely one. Facebook announced 2 Billion users a couple of days back (give or take the millions of bot accounts) Steemit might do that number in half the time, the future remains unwritten, maybe the upvote should have an alternative RMB ¥ to appeal to the potential Billions of wealthy Chinese users.