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Not so fast: Japanese think tank predicts China's economy will not overtake US until 2030s

US extends its lead in race with speedy economic recovery

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US, China flags. (Getty Images)

US, China flags. (Getty Images)

TAIPEI (Taiwan News) — China has been said to be on the cusp of surpassing the U.S. as the world’s largest economy for many years, yet the long-awaited moment now seems to be moving further into the future, according to the latest research from the Japan Center for Economic Research (JCER).

A new report from the think tank predicts that it will not be until 2033 that China’s GDP exceeds that of the U.S., according to Nikkei Asia Review. Last year, the JCER said it would be 2029.

The Chinese Communist Party’s crackdown on tech and other industries, China’s transition away from high-carbon energy, and ballooning debt stemming from the real estate sector all threaten growth, the report says. Investment is also likely to shrink as Beijing tightens financial regulations to get its real estate sector in order, the report predicts.

Not only is China slowing but the U.S. is picking up speed. The report considers the rapid recovery of the American economy, buoyed by the Biden administration’s massive stimulus package.

The research suggests the end result of the competition between the U.S. and China for global economic dominance is far from a foregone conclusion. The economic policies adopted by the governments in each country today will have far-reaching effects on their relational power for decades to come.