US report forecasts China as top economy

US report forecasts China as top economy

US report forecasts China as top economy

Updated 11 December 2012, 12:15 AEDT

An intelligence report forecasts that China will overtake the United States as the world's largest economy in the 2020s, but the US will remain the most influential country.


The National Intelligence Council, in its first assessment in four years aimed at shaping US strategic thinking, predicts that the US will still be the world's most influential country in 2030.

"The US most likely will remain 'first among equals' among the other great powers in 2030 because of its pre-eminence across a range of power dimensions and legacies of its leadership role," it said.

"Nevertheless, with the rapid rise of other countries, the 'unipolar moment' is over and Pax Americana - the era of American ascendancy in international politics that began in 1945 - is fast winding down," it said.

The study predicted that Asia's economy, military spending and technological investment would surpass those of North America and Europe combined by 2030, but warned of major uncertainty over an emerging China.


China's global power is likely to keep rising but at a slower rate - a phenomenon of easing growth that, according to historical precedent, makes countries "likely to become fearful and more assertive," the study said.



With a growing population and rising incomes, the planet's demand for water, food and energy will grow by 35, 40 and 50 percent respectively by 2030, it said.


Ageing populations

The National Intelligence Council estimated that the world will have nearly 8.3 billion people in 2030, up from 7.1 billion now, but that the average age will be older, with potentially giant consequences.

The study said that 80 per cent of armed and ethnic conflicts occurred in nations with youthful populations.


Other areas that will still have youthful populations, and the fuel for potential conflict, include Afghanistan, western and tribal areas of Pakistan and India's poorer northern states of Bihar and Uttar Pradesh, it said.

By contrast, the study found that the Middle East "will be a very different place" in 2030 with the gradual ageing of the youth bulge that took to the streets in the Arab Spring protests that brought down autocratic leaders.



Iran was a question mark. The study expected "far-reaching instability" if Iran developed a nuclear weapon, but also said that a more pro-Western Iran could emerge due to public pressure and infighting within the clerical regime.

The study said a potential resolution to the Israeli-Palestinian conflict would have "dramatic consequences," but suggested that a more likely scenario consisted of unofficial actions that lead toward a Palestinian state with key issues such as the status of Jerusalem remaining unresolved in 2030.