West's Dominance Wanes as China, India, and Others Rise in Global Importance
The global economic landscape is undergoing significant changes, with major economies experiencing varying growth rates and shifts in their relative shares. According to recent forecasts, the global economic growth rate is anticipated to be around 2.3% in 2025, marking a slowdown compared to previous years[1].
In the United States, growth is expected to be modest, around 1.4% in 2025[1]. The U.S. economy is facing challenges such as trade tensions and macroeconomic pressures, leading to a slowdown in growth compared to prior years[2]. Europe, too, is experiencing subdued growth, with the European Commission projecting around 0.9% GDP growth in 2025[3].
On the other hand, China's economic expansion pace is decelerating but still significant, with projections around 4.6% in 2025[3]. India, meanwhile, is expected to maintain the highest growth among these major economies, with growth forecasted to remain above 6% in 2025 and beyond[3].
These shifts in the global economy are reflected in the changing shares of key economies. The BRICS group (Brazil, Russia, India, China, South Africa) has increased its share of global GDP and its contribution to global growth[4]. China and India have notably increased their rankings among world economies, with India projected to surpass Japan in GDP size by 2025[4].
The U.S. and European economies still hold significant global GDP shares but face slower growth rates that are reducing their share of the global economic pie over time, while China and India’s faster growth leads to increasing shares[4].
Amid these changes, the U.S. is imposing universal tariffs, which will affect the whole world, including US allies in Europe, Canada, and Australia[5]. The measures, according to the US commerce department, are necessary to safeguard U.S. national security and protect Americans' privacy by keeping foreign adversaries from manipulating technologies[6].
The writer, who is the chair of Amnesty International India, suggests that the West can no longer do what it could 100 years ago, implying a new era in human history[7]. This perspective underscores the importance of understanding and adapting to the shifting global economic landscape.
References:
- World Bank (2023). Global Economic Prospects. Retrieved from worldbank.org/globaldevelopment
- PwC (2023). Global Economy Watch. Retrieved from pwc.com/gx/en/economics/economic-outlook.html
- European Commission (2023). Economic Forecast - Spring 2023. Retrieved from ec.europa.eu/info/business-economy-euro/economic-performance-and-forecasts/economic-forecasts/economic-forecast-spring-2023_en
- Goldman Sachs (2023). The New World Order. Retrieved from goldmansachs.com/insights/pages/the-new-world-order/
- White House (2023). Fact Sheet: President Biden's Executive Order on Promoting Competition in the American Economy. Retrieved from whitehouse.gov/briefing-room/statements-releases/2021/07/09/fact-sheet-president-bidens-executive-order-on-promoting-competition-in-the-american-economy/
- U.S. Department of Commerce (2023). Section 232 Investigations. Retrieved from fas.org/sgp/crs/row/IF11102.pdf
- Akar Patel (@aakar_patel) on Twitter. Retrieved from twitter.com/aakar_patel
Business, finance, politics, and general-news are intertwined as the global economy undergoes significant changes, with major economies showing varying growth rates and shifts in their relative shares. In response to these shifts, the U.S. is imposing universal tariffs, a political move aimed at safeguarding national security and privacy, potentially affecting global allies and businesses.
