China Overtakes UK!

The Chinese economy only just passed that of the UK and has a long way to go before it approaches the US. Their growth is very fragile, and they’re most likely to implode as one or more of their systemic weaknesses bites them.

The news comes via the New Economist:

China’s economy grew 9.9 percent in 2005, probably overtaking the U.K. as the world’s fourth largest, powered by record exports and investment in manufacturing. Gross domestic product rose to 18.2 trillion yuan ($2.3 trillion) after expanding 10.1 percent in 2004…

The economy grew 9.9 percent in the fourth quarter from a year earlier after expanding a revised 9.8 percent in the previous three months, the NBS said today. Economists forecast growth of 9.5 percent in the quarter and 9.8 percent for the full year, according to a Bloomberg News survey.

…The U.K. economy was worth $2.14 trillion in 2004, according to the World Bank, and the Organization for Economic Cooperation and Development has forecast 1.7 percent growth for the country in 2005. The U.S. economy, which measured $11.7 trillion in 2004, is the world’s largest.

China’s problem is that most if its technology is stolen, and the rest is imported. It’s also a very corrupt Fear State and these don’t prosper. Plus, it depends on the US buying its exports – if the US buys elsewhere, devalues the $, or forces a big revaluation of the Chinese yuan, they’ll hit the wall. Finally, they’re tooling up for a war with Taiwan, which – even if they win – will leave them severely trashed.

I wouldn’t put money into China.


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