The following chart depicts the relative size through time of major economies around the world. The forecasts were generated by the Center for Economics and Business Research (CEBR) and are made available by the Visual Capitalist which generously allows subscribers to use its excellent graphics.
First and foremost, note that the U.S. falls behind China by 2031, and the gap widens to $11.9 trillion or 21% by 2036. In fact, CEBR estimates that China would have surpassed the U.S. economy in size two years earlier were it not for the Covid-19 lockdowns that have currently shut down much of China’s economic activity. Primarily due to its ageing population, Japan falls from second to the fifth position with annualized economic growth over the entire thirty year period of just 1.3%. The mirror image is India which rises from fourteenth to third place with 8.4% annual growth, largely attributable to its population growth which is likely to result in India’s population surpassing that of China sometime in the next ten years. Finally, most of the major European economies fall from one to as many as seven notches due to minimal population growth and a lack of innovation.
Academics and think tanks all over the world are working to evaluate these economic shifts. It is much too early to make the call, but there will clearly be significant impact on international relations, military power, currencies, trade, and domestic politics. I’m glad that I don’t have to figure this one out!