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Reversing recession fears, the U.S. economy ended the year with 3.2% growth in the last quarter and sustained annual expansion of 2.5%, on par with the World Bank’s global growth forecast of 2.6%. Global economic expansion is expected to slow to 2.4% this year, but the United States may still be stuck at around 2%.
But while the United States, despite its alarming debt habits, has been able to sustain growth through growing budget and trade deficits, much of the rest of the world is sluggish.
Given that the next US president, whether Trump or Biden, is likely to continue increasing US spending and debt, will the rest of the world continue to fund the US?
In the short term, there appears to be no choice but to park your money in dollars.
For the Middle East, oil prices could remain flat, leaving it without additional ballast as oil-producing countries look to build a new base for renewable energy.
But in the medium term, it is simply unrealistic to expect the United States to become the main driver of global economic recovery.
China’s ‘new productive power’ plan should rouse the West to its feet
China’s ‘new productive power’ plan should rouse the West to its feet
Increasingly, global competition for leadership is not just about military and economic power, but also about technological superiority and the ability to generate wealth.
However, while China’s R&D spending is rapidly catching up with US budgets, “research and innovation in critical technologies such as AI is still dominated by US tech giants,” says Marina Yue of the University of Technology Sydney.・Professor Chan points out. Chinese tech companies have yet to reach the level of monetization from stock market wealth that their U.S. counterparts have.
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AI-generated cartoon series to be aired on Chinese state TV
AI-generated cartoon series to be aired on Chinese state TV
Therefore, the global competition will depend on who can translate AI technologies into widespread economic productivity.
China’s rise as the world’s green factory leaves Western countries at a disadvantage
China’s rise as the world’s green factory leaves Western countries at a disadvantage
For now, it is widely accepted that the United States is leading the way, followed by China, while the rest of the world struggles to apply AI to everyday consumption, production, and distribution functions. Poor developing countries that fail to improve productivity through AI and knowledge-based innovation will be stuck with low-tech technology.
The technological competition between the US and China is becoming a long march towards supremacy. But history is shaped by multiple structural forces and chance events, and the ultimate winner of the 21st century may not be either of the two front-runners or anyone else in the spotlight. yeah.
As possibilities become more diverse, the companies most committed to innovating with new technologies may ultimately survive. St. Matthew said: “Blessed are the meek, for they will inherit the earth.”
Andrew Shen is a former central banker who writes about global issues from an Asian perspective.
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