The accepted norm of Western dominance of the global order is now over. The difficult matter for those in the West to accept is that the mantle of leadership is not being passed from one Anglo-Western power to another of the same ilk, but rather one neither Anglo, nor Western, and dare I say it, not caucasian.
Of all numbers the most uncertain are projections, particularly to do with economics. That uncertainty lessens however when large highly reputable bodies with sound past records agree, giving consistent projections.
These show that the world economy is undergoing incredibly rapid change. That change is all about the decline of the West, and the rise of the East. Many in the West either cannot, or refuse to see that. They hold an assumption that Western dominance is the norm. It becomes impossible to believe that Western dominance, which began with the Renaissance, and continued with the Enlightenment and the Industrial Revolution, is now swiftly drawing to a close.
Perhaps the greatest sign of that past dominance was in how Britain, a land of a few million (5 million in 1700, 18 million in 1840) could defeat and then hold sway over the lands of India and then China, with their hundreds of millions.
That dominance held by Britain, following World War II passed to the U.S. So dominant was the U.S. following that war, with Europe and much of Asia, especially China, having exhausted themselves in the fight, in 1960 it represented some 40% of world GDP.
China and India, the long term dominant economic powers had fallen to pauper status, something now rapidly changing.
This current change shocks many in the West, primarily due to lack of long term understanding showing of China and India long being the dominant world economies.
Estimates indicate that under the Tang (618-907CE) and Song (960-1279) Dynasties, China may have represented as much as 80% of the world economy. Even under the Qing Dynasty (1644-1912) it had a 35% share, before sudden collapse following the Opium Wars.
With India we find something similar. In 1600 its share of global GDP was 22.4% while by 1700 that had grown to 24.4%.
The British economic historian Angus Maddison has made extensive studies of different nations in his work, ‘Contours of the World Economy 1-2030 AD’
The rapid collapse of both India and China shows just how powerful was Western hegemony. Western power was also supplemented by colonial conquest, through which they drained other nations, from Indo-China, the Americas, Africa and Australasia.
The accepted norm is now over. The difference this time is that the mantle is not being passed from one Anglo-Western power to another of the same ilk, but rather one neither Anglo, nor Western, and dare I say it, not caucasian.
Figures from PwC show that within just a few years the dominant world economic power will be China (20% of global GDP), followed by India (15%), the US dropping to third, (12%) with Indonesia 4th.
In 2016, US GDP per capita was around four times the size of China’s and almost nine times that of India’s. By 2050, these gaps are projected to narrow to around double China’s and around three times India’s, demonstrating long-term income convergence.
By 2050 the EU share of global GDP is expected to be less than 10%, while what PwC calls the E7 (the emerging) nations of China, India, Indonesia, Brazil, Russia, Mexico and Turkey, by 2040 will be double the size of the G7 (US, UK, France, Germany, Japan, Canada and Italy). To put this into perspective in 1995 the reverse was true, while in 2015 the two groupings were equal.
Interestingly most of these E7 nations are part of the BRICS block, or have applied to join.
The UK could be down to number 10, France outside that, while Italy will no longer be in the top 20 economies.
The greatest rise will come from Vietnam moving from 32nd to 20th, Philippines 28th to 19th and Nigeria 22nd to 14th.
In the same study PwC predicted as early as 2030 the size of global economies was expected to be China $43.879 trillion US $28.708 trillion and India $17.948 trillion. The Chinese economy using that indices will be 50% larger than that of the US.
The Lowy Institute shows a similar result, projecting again using PPP, as early as 2030 China’s economy being $42.74 trillion, the U.S. $28.146 and India $18.016 trillion.
Standard and Poor’s make similar findings
We don’t even need to look speculatively ahead to establish what is happening. The World Bank, using PPP, shows in 2022 the economy of China was $30.33 trillion, the US $25.46 trillion, with India at $11.87 trillion.
As recently as 1990 the US economy was five times larger than the other two. While in 2016 the Chinese and US economies were equal ($18.7 trillion), since then Chinese growth has doubled that of the US.
It is a fascinating exercise to work through the above sites.
While not exclusively so, the majority of the growth is occurring in Asia.
The opportunity, given our geographical location, is enormous for Australia. Unfortunately though, we cling to an outmoded Anglo colonial picture of the world.
John Queripel is a Newcastle-based historian, theologian, social commentator and published author of three books. His blog may be found at www.johnqueripelblog.com.
Substack / https://johnqueripel.substack.com
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