China’s economic growth is projected to slow down significantly, with an estimated 1 percent growth rate in 2050, compared to the United States’ 1.5 percent.
The COVID-19 pandemic has dealt a lasting blow to China, altering its economic trajectory. Before the virus emerged and spread globally, China was on track to surpass the United States as the world’s largest economy by the early 2030s. However, the revised outlook suggests that China will now achieve this milestone no earlier than the mid-2040s, and even then, by a narrow margin.
According to recent research from Bloomberg Economics, China’s gross domestic product is expected to outpace that of the United States by a slight margin in the mid-2040s before potentially falling behind again. This shift toward slower growth has occurred sooner than anticipated, signaling concerns about China’s economic prospects.
The report notes, “China is transitioning to a slower growth trajectory earlier than expected.” The post-COVID economic rebound has lost momentum, attributed to a deepening property market slump and waning confidence in Beijing’s economic management. This declining confidence could persist, posing a long-term drag on growth potential.
Projections for China’s economic growth have been revised downward, with estimates indicating a slowing rate of 3.5 percent in 2030 and just 1 percent in 2050, compared to earlier forecasts of 4.3 percent and 1.6 percent, respectively.
China faced its slowest growth in decades, with a 3 percent growth rate last year, driven by a stringent “zero-COVID” policy and a real estate crisis. Although China relaxed its pandemic control measures late last year, the expected economic recovery has not materialized as anticipated. Exports have declined, and the real estate sector’s challenges have continued.
Economists are now predicting that China’s economy will grow at less than 5 percent by 2024.
Observers in the West are closely monitoring China’s economic decline and are recalibrating their strategies for dealing with a China that is either plateauing or weakening. Additionally, China’s declining population, which experienced its first decrease since the 1960s, has raised concerns about diminishing productivity potential.
Routine crackdowns on dissidents within China and escalating tensions with the United States over issues like Taiwan and the South China Sea have further complicated the situation.
In contrast, the United States appears to be in a stronger economic position than expected just a few months ago. A robust labor market, strong consumer spending, and controlled inflation have helped the United States stave off recession concerns. Long-term forecasts for the U.S. economy indicate a gradual decrease to a 1.5 percent growth rate by 2050, with an expected growth rate of 1.7 percent in 2022-2023.
