It won’t take long to answer this question. Therefore, most of this post will be spent considering why this is a problem in the first place.
Consider the following Bloomberg headline and subhead:
Who thinks that China is not an economic superpower? China
One of the most debated topics at the upcoming global climate conference is whether China should still be considered ‘developing’.
According to the IMF, China’s GDP per capita is estimated at $13,136 in 2024, well below the US figure of $85,373, and even below Mexico’s $15,246. In PPP terms, China’s GDP is $25,015, again slightly lower than Mexico’s. China is clearly a developing country. So what’s going on here?
In recent years, the US government has adopted a hostile relationship with China, and most media outlets have aligned themselves with this agenda. This attitude colors the way the media views all kinds of issues. Consider the following two examples:
1. When the Chinese government reports strong GDP growth, many media outlets are immediately skeptical. Experts are quoted as saying that the official Chinese figures are exaggerated. Studies using satellite data on nighttime illumination suggest that China is much poorer than it claims to be.
2. When China is seen as a threat to US national security, or when China is expected to contribute money to the fight against global warming, then China is seen as an advanced economy, and even as a ‘powerhouse’ economy.
There seems to be no “fact” when it comes to China’s development status. Rather, it is considered a backward developing country or an advanced developed country, depending on whether that status advances a particular argument advanced by powerful special interests.
If the goal is to show that China has a bad government, then it is obviously difficult to report great economic growth figures. If your interest is to convince the public that China is a formidable competitor to the US, then it is obviously difficult to report that China is only a developing country.
This is how I read Bloomberg’s headline and subheadline. At this point, it is convenient for the US government to view China as an economic powerhouse. But not always. If reports of China’s rapid economic growth lead other developing countries to consider the Chinese system worth emulating, then it is time to point out that the GDP figures are probably too high and that the Chinese economic system is actually quite is inefficient. China is much poorer than the government claims.
I don’t have either position because I don’t have an agenda. I believe that China has grown very quickly since Maoist economic policies were replaced by market reforms. I believe China is as rich as the government claims, and probably even richer. (Richer than Mexico.) I trust my own eyes much more than satellite models of an economy. But I don’t believe China is a fully developed economy. The country still lags behind the US by a wide margin, and will continue to trail the US for the foreseeable future. China still lags behind other East Asian economies such as Japan, South Korea, Taiwan and Singapore, largely because the Chinese government remains overly involved in the economy.
In my view, China poses no threat to America’s near-total dominance of the 21st century global economy. Indeed, with the rise of high-tech, that dominance is becoming increasingly entrenched, with the US share of global stock market capitalization recently rising to an astonishing 61%. At the same time, I understand why some people have alternative views. China is a major player in many industries, especially manufacturing. But whatever your opinion, it is important to avoid reasoned reasoning. Whether or not China is a developed country does not depend on whether that fact advances an argument that you happen to be making at this moment.