China still has a long way to go before it overtakes the United State. The gap between China and many developed countries remains significant.
A comparative study recently released by The World Bank’s International Comparison Project (ICP) estimated the world’s economies for 2011, and found that China’s economy is likely to surpass that of the U.S. this year.
Purchasing power parity (PPP) was used to prepare the recent estimates. According to experts from China’s National Bureau of Statistics the numbers underestimate Chinese prices and overestimate the country’s GDP (gross domestic product ).
In Western countries, GDP is an indicator of output which equates to the level of a resident's income. But in China there is huge gap between GDP and resident income. Usually, China’s revenues make up 70%-75% of GDP, says Professor Huo Deming from the National Development Research Institute of Peking University.
While it is indisputable that China has rapid GDP growth, there is still a significant gap between China and developed countries like the US and many other European countries, in terms of quality of development and per capita GDP. World Bank statistics show that in terms of purchasing power parity (PPP), per capita GDP of China's mainland in 2011 was $ 10,057, ranking 99th in the world, while the per capita GDP of the U.S. was $ 49,782, ranking 12th.
China's economy is now shifting from high-speed growth to medium-speed growth, requiring us to direct more attention to the quality of development. “Although the gap between the two countries in total economic activity is narrowing, we can still see quite a disparity in per capita GDP," says Xu Guangjian, professor of the Institute of Public Affairs in Renmin University. He points out that China is the world's manufacturing center. Services and high-tech industries still make up a relatively low proportion of its economy.
As a large developing country, China's basic conditions remain unchanged. Zhang Liqun, a researcher from the State Council Development Research Center says that the quality of economic development is much more important than the percentage of GDP growth.
The OECD once estimated that China would become the world’s largest economy in 2016; China itself pegged 2025 as the year it would catch up with or slightly surpass the US at an annual GDP growth of 7.5%.
In contrast to the hype in the western media about China ending the US reign as the world's biggest economy over more than 140 years, Chinese media and economists have begun to rethink the current model of economic development. After 30 years pursuit of GDP regardless of the cost to the environment and resources, Chinese people are aware that what China needs is green mountains and clean waters - a long-term balanced development model - once basic needs are provided for.
The article is edited and translated from《中国离发达国家还有很长路》, source: People's Daily, author: Zhou Xiaoyuan.