The US has been stripped of its title as the richest country in the world, with China now being the world’s wealthiest nation. The switch-up in the global wealth leaderboard was announced in a report from McKinsey & Co., says Bloomberg who first broke the story, which revealed that China’s value skyrocketed from $7 trillion in 2000 to $120 trillion in 2020.
In that same time, the value of the United States climbed to almost $90 trillion, falling short of the number one spot.
China’s race to the top of the leaderboard contributed to almost a third of the total increase in global wealth which went from $156 trillion to $514 trillion in the same time frame.
It’s thought that China’s economic rise accelerated after it became a member of the World Trade Organisation (WTO), an intergovernmental organization that regulates trade between nations. Countries can benefit from such membership as the WTO aids nations in establishing the rules of international trade and enforcing them in developing markets.
While a sizable victory indeed, it’s not one shared by the whole country as it’s estimated that more than two-thirds of the wealth is contained to just 10 percent of the wealthiest households. The same ratio is seen in the US, which now sits at position #2 in the global wealth charts.
China’s progress will be one to watch over the coming years, as while economic growth brings a healthy return, certain patterns in rising net worth can make nations vulnerable to collapse. The infamous 2008 US collapse that was triggered by a breakdown in the housing economy demonstrated this all too well, and with rising property prices being partly responsible for China’s meteoric rise experts will need to keep a weather eye on the horizon for signs of a similar financial event.
Speaking of mo money mo problems, did you hear about the UN World Food Program calling Elon Musk's bluff? The world awaits to see if he'll pay up.
[H/T: Interesting Engineering]