OECD predicts China’s economy will overtake the euro zone economy by end of 2012, US economy by 2016
A leading economic organization has predicted that China’s economy will overtake that of the US by 2016, prophesying a major shift in the balance of global economic power. The Paris-based Organization for Economic Co-operation and Development (OECD) forecasted that China’s economy would overtake the economies of the entire euro zone by the end of 2012 and it will be larger than the US economy by 2016. By 2025, the combined GDP of China and India will outgrow that of France, Germany, Italy, Japan, UK, US and Canada put together, the OECD said.
“It is quite a shift in the balance of economic power we are going to see in the future,” said Asa Johansson, a senior economist at the OECD. The organization of 34 countries forecasted that the global imbalances that led to the global economic crisis in 2007 will intensify and reach pre-crisis levels by 2030. The OECD warned that the escalating imbalances could undermine the global economic growth and noted that the situation cannot be ameliorated unless countries embark on more ambitious reforms with respect to labor and production.