Since the reform and opening up, our country has entered a golden age of rapid development. The social and technological levels have made great progress, and the people's living standards have also been continuously improved. In this ever-evolving environment, my country has become the world's second largest economy today.
GDP gap
GDP is undoubtedly an important measure of a country's economic development level. In 2020, affected by the health incidents, the economies of all countries will decline as a whole. Among the 16 countries in the world with GDP exceeding one trillion U.S. dollars, my country is the only country that maintains a positive GDP growth rate of 2.3%, which is once again getting closer. The gap with the United States. Even in the previous few years, my country's GDP growth rate was higher than that of the United States, which is enough to show the rapid development of the domestic economy. According to the Wall Street Journal's forecast, my country may overtake the United States around 2028 and become the world's largest economy.
Affected by the health incident, the unemployment rate in the United States was once as high as 14.7%, and more than 70% of the US economic growth was supported by consumption, so most Americans simply did not have enough Savings to maintain daily life has to rely on relief funds to survive. For this reason, the United States began printing money to rescue the market and issuing relief funds, but even so, many Americans still began to reduce consumption. Against this background, many voices from the outside world point to such a question-will it lead to stagnation in US consumption, have a negative impact on the economy, and further narrow the gap between China and the United States?
Does my country's GDP exceed that of the United States?
In fact, in the reports of the World Bank and the International Monetary Fund, my country's total GDP has surpassed that of the United States. In May 2020, the World Bank published the "Purchasing Power Parity and World Economic Scale-Results of the 2017 Round of International Comparison Project (ICP)" and pointed out that:If calculated in terms of purchasing power parity, the top 10 economies in terms of global GDP in 2017 were China, the United States, India, Japan, Germany, Russia, the United Kingdom, Brazil, France, and Indonesia.
It is not only the World Bank that came to this conclusion, the International Monetary Fund has also published a similar report, and this conclusion was reached earlier than the World Bank. The International Monetary Fund pointed out in a report that if calculated in terms of purchasing power parity, as early as 2014, China's total GDP exceeded that of the United States.
PPP
First of all, we need to clarify what PPP is. The so-called purchasing power parity refers to the equivalence coefficient between currencies calculated according to the different consumption levels of various countries. The purpose is to make a reasonable comparison of the GDP of various countries. Compared with the real exchange rate, the purchasing power parity exchange rate may have a large gap.
In this regard, Bai Chongen, Dean of the School of Economics and Management of Tsinghua University, said that generally speaking, when most industries in a country are involved in international trade, the market exchange rate can more intuitively reflect the purchasing power of the currency ; When most industries in a country are not involved in international trade, its market exchange rate often deviates from the actual purchasing power of the currency. Therefore, in ordinary economic research, since the market exchange rate is affected by various factors and is related to the country's economic structure, the purchasing power parity exchange rate is generally quoted.
Generally speaking, when calculating parity purchasing power, it is necessary to set up a "consumption list" to calculate consumption in different countries. Dean Bai Chongen gave an example, such as listing a Chinese consumer's one-year consumption in a list, using a total of 30,000 yuan when spending in China. Then follow this list to make the same consumption in the United States, and calculate how many dollars it will cost. It costs US$6,000 to join,Then the purchasing power parity exchange rate at this time is 5 yuan equal to 1 U.S. dollar.
In comparison, purchasing power parity can better show the level of consumption between countries. To give a very simple example, such as the sudden depreciation of the renminbi, the corresponding GDP in US dollars will shrink accordingly. However, this does not mean that the Chinese people are becoming poor. On the basis of maintaining the original income and price levels, the competitiveness of imported goods will not have much impact on the lives of Chinese people. Therefore, currency depreciation will not lead to China. People’s actual quality of life has declined.
Although my country may have surpassed the United States from the perspective of purchasing power parity, in all fairness, there is still a certain gap between my country and the United States. For example, from the perspective of the added value of the primary industry, my country is as high as $11,272, which is 6.41 times that of the United States. However, the number of employees in my country's primary industry is close to 200 million, while the United States is only about 2 million. There is a big difference in the added value created by unit personnel, and there is still a big gap in efficiency. As for the tertiary industry, my country’s added value is only 47.1% of that of the United States. Compared with the disparate population, the gap is still relatively large.
Of course, our country has surpassed the United States in some areas. As early as April last year, the World Intellectual Property Organization announced that my country applied for 58990 patents through the PCT system in 2019, surpassing 57,840 patents in the United States, breaking the United States’ 40-year lead in this field, and also representing my country’s technological advancement. The rapid development of the career.
Don't be humble and don't be arrogant. Facing the gap squarely and catching up is the goal of every citizen's struggle, and it is also the hope of the country's prosperity.
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