China's economy will overtake the U.S. as the biggest in the world by as soon as 2016, according to leading think tank, the Organisation for Economic Co-operation and Development (OECD). GDP growth forecasts, released by the OECD in Paris Friday, suggest an economic power shift away from the west in the next few years (via the Guardian):
Global GDP will grow by 3% a year over the next 50 years, it says, but there will be large variations between countries and regions. By 2025, it says the combined GDP of China and India will be bigger than that of France, Germany, Italy, Japan, UK, US and Canada put together. Asa Johansson, senior economist at the OECD, said: "It is quite a shift in the balance of economic power we are going to see in the future."
Founded in 1961, the OECD is an international economic organization of 34 countries, including the U.S., Japan and euro nations. In its latest forecast the think tank also noted that income inequality within emerging economic powers will likely persist and worsen, despite predictions that the poorest countries will become around four times richer by 2060, while China and India are expected to experience more than a seven-fold increase in income per capita. As Salon reported last week, global income inequality is currently at a 20-year high according to research by charity Save the Children.
"The OECD warned that rising imbalances could undermine growth. But, it said, if countries undertook more ambitious reforms with regards to labour and production, they could be reduced," the Guardian noted.
"None of these forecasts are set in stone," said OECD Secretary-General Angel Gurria during a Friday press conference.
This video from the OECD offers more detail on the forecasts: