China surpasses the US to become the richest country in the world
A report by global management consulting firm McKinsey & Co shows that China has surpassed the US to become the country with the largest assets in the world.
A report by global management consulting firm McKinsey & Co shows that,Chinahas surpassed the US to become the country with the largest assets in the world.
Bloomberg news agency cited research by McKinsey & Co indicating that China's net asset value increased 17 times from 7,000 billion USD in 2000 to 120,000 billion USD in 2020.
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| China accounts for one-third of global net worth growth over the past 20 years. Photo: Bloomberg |
During the same period, US net worth doubled to $90 trillion. Global net worth increased from $156 trillion to $514 trillion.
China’s entry into the World Trade Organization (WTO) has accelerated its economic growth, accounting for one-third of the increase in global net worth over the past 20 years.
In both China and the US, more than two-thirds of wealth belongs to the richest 10%, and this proportion is growing.
According to McKinsey calculations, 68% of assets onworldis real estate. The surge in net worth over the past 20 years has outpaced global GDP growth, fueled by rising property prices thanks to low interest rates.
The consultancy also warned about the sustainability of the property boom, which will leave fewer people able to own homes and increase the risk of a financial crisis.
China alone could be in trouble because of a debt bomb, similar to the debt crisis of real estate developer China Evergrande.