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China is setting to overtake Japan as the world’s second-largest economy behind the U.S. this year. Despite its fast growth over the past three decades, China remains a developing economy. Economists have so far described China’s overtaking of Japan as "just symbolic".
Early Monday, the Japanese government estimated its gross domestic product (GDP) at $1.286 trillion (8.74 trillion yuan) in the April-to-June quarter, compared to China’s $1. 335 trillion.
China has surpassed Japan in quarterly GDP figures before, but this time it is unlikely to be a temporary switch. China is growing at about 10 percent a year, while Japan is forecast to grow at 2 to 3 percent this year.
Despite emerging as an economic power, China remains far behind many countries if per capita GDP is taken into account.
In 2009, China reported a per capita GDP of $3, 687, as compared to $ 37,800 for Japan and $ 46,436 for the U. S..
As a result, Kyohei Morita, chief economist at Barclays Capital in Tokyo, described China’s overtaking of Japan as "Just symbolic--nothing more than that."
Commenting on the situation, a New York Times report said China is "a country burdened with a fifth of the world’s population and insufficient resources. Its per capita income is more on a par with those of impoverished nations like Algeria and Albania."
Cui Peng at CBN Weekly wrote that "there’s no reason to get excited just because China has surpassed Japan in GDP". By way of explanation, he compared GDP to a company’s turnover.
"A high turnover doesn’t always bring high profits; the high costs behind the turnover might make the company lose money," he explained.
Also, China is still facing domestic problems like poverty and a widening wealth gap.
"China is a developing country. The quality of China’s economic development still needs to be raised. It needs more effort to improve economic quality and people’s lives," said Yao Jian, Commerce Ministry spokesman, on Tuesday. It was the government’s first public reaction to the news.
Why have economists described China’s overtaking of Japan as "just symbolic"