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Last Updated: Friday, 3 March 2006, 17:33 GMT
China 'to dwarf G7 states by 2050'
Chinese worker
China has a cost advantage with its cheaper workforce
China's economy is projected to grow so fast that it could outstrip all developed nations by 2050, a report by Pricewaterhouse says.

The Asian giant's economy is set to double in size between 2005 and 2050, according to the report.

As with other developing countries, a key driver for China's rapid growth is its younger, cheaper workforce, it argues.

India, meanwhile, is expected to be the world's fastest-growing economy.

China's boom

PwC is basing its analysis on forecasts for economic growth on the basis of purchasing power parity (PPP).

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This figure defines the size of an economy by adjusting for local costs.

While China's economy is currently 18% the size of the US's in dollar terms, it is 76% as big on a PPP basis.

By 2050, PwC believes, it could be 43% bigger than the US by PPP - although it would still lag when measured in terms of dollar size.

Also on a PPP basis, PwC says the German, UK and French economies could end up smaller than Mexico's economy and similar in size to that of Russia.

Both Japan and Germany whose economies stand in second and third place after the US, are expected to be surpassed by developing countries India and Brazil by 2050.

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