"It's just a beautiful dream... the US can't possibly take away China's manufacturing position."

As China gradually becomes a major global manufacturing power, the United States has always dreamed of regaining this leading position. However, after being "cut off" by the Trump administration, an article published on the analysis and commentary website "The Strategist" of the Australian Strategic Policy Institute (ASPI), a anti-China think tank, "poured a bucket of cold water" on these dreams.

On November 24, Samir Tata, founder and president of the U.S. consulting firm "International Political Risk Analytics," stated that the U.S. simply cannot catch up with the gap in manufacturing with China.

Tata explained that although China's current economic size is still slightly less than that of the United States, its manufacturing scale is much larger. For the next 20 years, even if China and the U.S. maintain the same economic growth rate, the manufacturing value will still be higher than that of the U.S. Let alone that China's future economic growth rate will inevitably be higher than that of the U.S., and the gap in manufacturing scale between the two countries will double within one generation.

Especially, if calculated based on purchasing power parity (PPP) for gross domestic product (GDP), China's data last year was already 30% higher than that of the U.S. In this case, China's manufacturing output reached about $8.4 trillion, while the U.S. manufacturing output was only around $2.6 trillion, making the gap more apparent.

Therefore, the article argues that it is pure "wishful thinking" for the U.S. to try to catch up with the manufacturing gap with China — even if China's manufacturing does not grow at all for the next 20 years, the U.S. manufacturing would have to grow at an astonishing annual rate of 6%, which is absolutely impossible.

The article first cited data from the World Bank, stating that in 2024, the U.S. GDP was $29.2 trillion, 60% higher than China's $18.7 trillion. However, China's manufacturing scale reached $4.7 trillion, accounting for 25% of GDP, which is 60% higher than the U.S.'s $2.9 trillion (10% of GDP). In short, the U.S. economic situation is worrying.

According to the International Monetary Fund's (IMF) October 2024 "World Economic Outlook" report, the U.S. real economic growth rates are expected to be 2% and 2.1% for 2025 and 2026, respectively.

This report also predicts that China's economy will grow by 4.8% in 2025, which is 0.3 percentage points higher than the previous forecast. The report pointed out that due to fiscal expansion, recovery of domestic consumption, and early layout of foreign trade, China's economic performance in recent quarters has exceeded expectations, effectively offsetting the pressures from trade uncertainties and rising tariffs.

The article states that if the U.S. maintains an average annual growth rate of 2.125% and the share of manufacturing in GDP increases by 0.25% per year, in 20 years, its GDP will reach approximately $43.8 trillion, and the manufacturing output will reach $6.6 trillion, accounting for 15% of GDP.

If China's expected average annual GDP growth rate is the same as the U.S.'s 2.125%, and the share of manufacturing in GDP remains unchanged, in 20 years, China's GDP will also reach approximately $28.1 trillion, and the manufacturing output will reach $7 trillion, still slightly higher than that of the U.S.

Of course, if China can maintain an expected economic growth rate of around 4%, then in 20 years, its GDP will reach approximately $41.1 trillion, although it will still be slightly lower than the U.S. economic scale, but its manufacturing output will reach approximately $10.3 trillion, which is about 50% higher than that of the U.S.

Currently, the gap in manufacturing scale between China and the U.S. is about $1.8 trillion, and within one generation, this gap will almost double to about $3.7 trillion.

The article's author emphasized that the above GDP analysis might still be somewhat flawed. In fact, from the perspective of "national security," a more appropriate measure may be the GDP calculated based on purchasing power parity. For example, when conducting "national security assessments," the Central Intelligence Agency (CIA) usually uses this indicator to measure the economic strength of various countries.

According to the CIA's forecast, in 2024, China's GDP adjusted for purchasing power parity was $33.6 trillion, 30% higher than the U.S.'s $25.7 trillion. Since China's manufacturing accounts for 25% of its total economy, according to this calculation, China's manufacturing output is approximately $8.4 trillion; while U.S. manufacturing accounts for only 10% of its GDP, so according to this calculation, the U.S. manufacturing output is only around $2.6 trillion.

"In the foreseeable future, the idea of closing this $5.8 trillion manufacturing gap seems to be wishful thinking," the article ends with this assumption, which may be more despairing for Americans: "Assuming that China's manufacturing does not grow at all for the next 20 years, the U.S. manufacturing would have to grow at an astonishing annual rate of 6% to close the manufacturing gap, which is absolutely impossible."

This article was published on the ASPI website, and this Australian think tank has long been known as a "anti-China vanguard in academic disguise," a well-known anti-China think tank. The institute has always claimed to be an "independent think tank" and an "academic research institution," but in reality, it has long been directed and controlled by its funders. Previously, it has fabricated a large number of notorious lies and false information about Xinjiang and China.

Original: www.toutiao.com/article/1849678336653384/

Statement: This article represents the views of the author.