BEIJING: China's economy will be the biggest in the world by 2020 and twice the size of the US by 2030, one of China's leading economists has predicted.
The claims are made by Hu Angang, dean of the Institute for Contemporary China Studies and a professor of economics at Tsinghua University, in his new book, China 2030, which, Xinhua reported
, would soon be published in English.
Hu points to five growth drivers, including accelerating industrialization, China's role in a new globalized world, its dominance in information technology, the rapid modernization of its infrastructure in areas such as electricity supply and high-speed railways, and the growing internationalisation of its economy.
Other economists were more cautious, pushing the timeframe out from 2030 to 2040 or 2050, while admitting the first date was possible.
"There is phenomenal room for growth in China, space for major industrial development, and once China gets its own world-class companies, they have a huge domestic market as well as an international market to serve," noted Miranda Carr, head of China research at London-based investment research firm NSBO.
But George Magnus, senior independent economic adviser at UBS in London, said such predictions were "spreadsheet" calculations and warned of a possible crunch around 2015 and 2016 when a lot of local government debt was due to be repaid or rescheduled.
Quality and innovation were other factors offered as reasons why 2030 was an overly optimistic date. Gary Liu, executive director of CEIBS Lujiazui Institute of International Finance in Shanghai, said poor air and water quality would result in more people getting serious diseases. "This is not a small issue," he stated.
His colleague Xu Bin, professor of economics and finance and associate dean at CEIBS, said reform of the state-owned sector was necessary if the economy was to grow.
"It needs to be driven by innovation and there is no way that this can be accomplished by state-owned enterprises," he declared.
"The export-led model has come to an end for China," he added. "China is already an upper-middle-income country, and the room for catch-up is significantly smaller than 30 years ago."
Data sourced from Xinhua; additional content by Warc staff