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Economy

China gains momentum in race to overtake US economy

Beijing's quick pandemic response gives an edge, as GDP reaches 70% of America's

A security personnel member stands guard in front of a construction site of Beijing Winter Olympic and Paralympic Village.   © Reuters

BEIJING -- China's economy surged closer to its American rival last year, achieving nominal gross domestic product of $14.73 trillion -- more than 70% that of the U.S., data released Sunday by the National Bureau of Statistics in Beijing shows.

The Asian country's economy grew at 3% in dollar terms during 2020, based on an average exchange rate of 6.8974 yuan to the greenback. China reached 101.59 trillion yuan in terms of local currency, topping 100 trillion yuan for the first time.

China's action to suppress its coronavirus outbreak in the early part of last year helped industrial production stage a quick recovery in spring, fueling real estate development and other economic activity. Overseas demand also gave a boost.

By contrast, the U.S. struggled with its initial response to the pandemic, hampering the economy. Nominal GDP shrank 2.3% last year to $20.93 trillion, the Commerce Department said.

Consequently, China's nominal GDP equaled 70.4% that of the U.S., climbing by 3.6 percentage points from 2019 for the first rise in two years. China now accounts for 17% of global GDP, the statistics bureau says, up from 10% in 2010.

The contrast in pandemic responses suggests China will overtake the U.S. as the top global economic power sooner than expected. The Japan Center for Economic Research projected in December that China would surpass the U.S. in nominal GDP as soon as 2028. The center had forecast in 2019 that the U.S. "will not be overtaken by 2035."

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