US economy outpaces China’s for first time since 1976
According to Bloomberg, in 2022 the US economy will outpace China’s for the first time in half a century. The both countries' approach to the coronavirus pandemic has taken its toll.
Bloomberg analysts emphasize that the US will outperform China for the first time since 1976. This lag is due to numerous lockdowns imposed by China amid the COVID-19 pandemic. The news agency stated that further problems of the country’s economic growth may cause a change in political roles.
Experts forecast that China’s economy will expand by only 2% in 2022. At the same time, the US GDP will grow by 2.8% during the reporting period. This outlook differs significantly from Beijing's goal to achieve 5.5% GDP growth by the end of 2022.
However, economists doubt that this optimistic scenario is realistic even in favorable circumstances, i.e. by easing COVID-19 restrictions. In the first quarter of 2022, a decline in retail sales and industrial production may affect China’s GDP contraction.
The US economy is also under excessive pressure. Currently, the country is trying to curb rampant inflation. In contrast to China, its major advantages are lower unemployment and increased consumer spending. According to US President Joe Biden, the US has outperformed China significantly. "For the first time in 20 years, our economy has grown faster than China's," Biden said.
However, the US economy could face a crisis and enter a recession in the medium term. Analysts at the Federal National Mortgage Association predict that the worst-case scenario is likely next year. Taking into account the economic success of both countries, the agency noted that China had taken the lead due to its reforms and open policy at the end of the 1970s. These measures allowed China to achieve high rates of economic growth. However, the COVID-19 pandemic made some changes. Consequently, China's GDP growth totaled 6.6% in 2018 and only 6% in 2019. In 2020, the national economic output increased by 2.3%, the lowest figure in 45 years.