Leading article: Second among unequals

Share
Related Topics

Do not be fooled by the figures. China may have now officially overtaken Japan to become the world's second biggest economy with a GDP of $5.9 trillion. This is an important symbolic shift for the country whose economy will eventually become bigger than that of the United States, an inevitability in the long run given that it has four times the population. But second biggest is not second wealthiest.

The average Japanese earns almost $40,000 a year compared with just $3,600 per head in China. Though Shanghai and Beijing now boast luxury boutiques, hundreds of millions of Chinese still live in severe hardship, particularly in rural areas – from which people are migrating with such speed that China will have 221 cities of over one million inhabitants each by 2025. China's rapid economic growth has had costs in pollution, frustrated civil liberties and poor infrastructure.

China is the world's manufacturer in some areas. It makes nearly 60 per cent of the world's clothes and 80 per cent of its toys. One day its population will constitute a huge consumer market for the West's goods, but at present it buys just 2 per cent of UK exports. Huge trade deficits will remain for some time and pressure will increase on Beijing to allow its currency to rise in value.

China's hunger for natural resources and energy will also drive up the cost of commodities and raise the potential for conflict. It will also mean trade deals in Africa, Latin America and Asia which undermine the human rights and good governance reforms desired by the West. Gentle pressure will need to be maintained on Beijing on that. The same is true of global warming, for no meaningful international deal can be done without China. Though given the country's lack of per capita wealth, it will still be the West that needs to lead on climate change.

What is clear is that the Chinese economy, which has more than doubled in size in the past 10 years and will double in size again in the next 10, is becoming an important engine of global growth. That should be an investment opportunity for the richer world, rather than a cause for apprehension.

React Now

Latest stories from i100
iJobs Job Widget
iJobs General

Ashdown Group: Database Analyst - Birmingham - £22,000 plus benefits

£20000 - £22000 per annum + excellent benefits: Ashdown Group: Application Sup...

SThree: Recruitment Resourcer

£20000 - £25000 per annum + Uncapped Commission: SThree: Do you want to get in...

Ashdown Group: Project Manager - Birmingham - up to £40,000 - 12 month FTC

£35000 - £40000 per annum: Ashdown Group: IT Project Manager - Birmingham - ...

SThree: Recruitment Consultant - IT

£25000 - £30000 per annum + Uncapped Commission: SThree: Sthree are looking fo...

Day In a Page

Read Next
 

Prevention is better than cure if we want to save the NHS

Tanni Grey Thompson
Question time: Russell Brand interviewing Ed Miliband on his YouTube show  

Russell Brand's Labour endorsement is a stunning piece of hypocrisy

Lee Williams
Fishing for votes with Nigel Farage: The Ukip leader shows how he can work an audience as he casts his line to the disaffected of Grimsby

Fishing is on Nigel Farage's mind

Ukip leader casts a line to the disaffected
Who is bombing whom in the Middle East? It's amazing they don't all hit each other

Who is bombing whom in the Middle East?

Robert Fisk untangles the countries and factions
China's influence on fashion: At the top of the game both creatively and commercially

China's influence on fashion

At the top of the game both creatively and commercially
Lord O’Donnell: Former cabinet secretary on the election and life away from the levers of power

The man known as GOD has a reputation for getting the job done

Lord O'Donnell's three principles of rule
Rainbow shades: It's all bright on the night

Rainbow shades

It's all bright on the night
'It was first time I had ever tasted chocolate. I kept a piece, and when Amsterdam was liberated, I gave it to the first Allied soldier I saw'

Bread from heaven

Dutch survivors thank RAF for World War II drop that saved millions
Britain will be 'run for the wealthy and powerful' if Tories retain power - Labour

How 'the Axe' helped Labour

UK will be 'run for the wealthy and powerful' if Tories retain power
Rare and exclusive video shows the horrific price paid by activists for challenging the rule of jihadist extremists in Syria

The price to be paid for challenging the rule of extremists

A revolution now 'consuming its own children'
Welcome to the world of Megagames

Welcome to the world of Megagames

300 players take part in Watch the Skies! board game in London
'Nymphomaniac' actress reveals what it was really like to star in one of the most explicit films ever

Charlotte Gainsbourg on 'Nymphomaniac'

Starring in one of the most explicit films ever
Robert Fisk in Abu Dhabi: The Emirates' out-of-sight migrant workers helping to build the dream projects of its rulers

Robert Fisk in Abu Dhabi

The Emirates' out-of-sight migrant workers helping to build the dream projects of its rulers
Vince Cable interview: Charging fees for employment tribunals was 'a very bad move'

Vince Cable exclusive interview

Charging fees for employment tribunals was 'a very bad move'
Iwan Rheon interview: Game of Thrones star returns to his Welsh roots to record debut album

Iwan Rheon is returning to his Welsh roots

Rheon is best known for his role as the Bastard of Bolton. It's gruelling playing a sadistic torturer, he tells Craig McLean, but it hasn't stopped him recording an album of Welsh psychedelia
Morne Hardenberg interview: Cameraman for BBC's upcoming show Shark on filming the ocean's most dangerous predator

It's time for my close-up

Meet the man who films great whites for a living
Increasing numbers of homeless people in America keep their mobile phones on the streets

Homeless people keep mobile phones

A homeless person with a smartphone is a common sight in the US. And that's creating a network where the 'hobo' community can share information - and fight stigma - like never before