China growth

To be sure, the $10,000 per capita GDP barrier does not have a lot of significance.

According to the World Bank classification for fiscal year 2020, low-income economies are defined as those with a Gross National Income (GNI) per capita of $1,025 or less in 2018; lower middle-income economies are those with a GNI per capita between $1,026 and $3,995; upper middleincome economies are those with a GNI per capita between $3,996 and $12,375; high-income economies are those with a GNI per capita of $12,376 or more. So, China will continue to be in the uppermiddle income country classification.

Of the 218 countries for which income group data was available, according to a June 2019 World Bank classification, 80 countries were in the high-income category, while 60, 47 and 31 countries were in the upper-middle income, lower-middle income and low income category. South Asia, which also includes India, is the only region which does not have a high-income country. India is in the lower-middle income category with a per capita GNI of $2,079 in 2018.

While China crossing the $10,000 per capita GDP barrier might not sound like a big development in the descriptive stats on income-wise distribution of countries discussed above, it’s a significant development given the size of the Chinese economy. Between 2010 and 2018, the latest period for which GDP data is available in the World Development Indicators database of the World Bank, China accounted for 29% of the total increase in world GDP in constant US dollars. This is 10 percentage points more than US’S share in incremental global

GDP during this period.

For India, the number is 7.5%. China’s share in world GDP in 2018 was 13%.

China’s GDP growth will not come back to its earlier double digit levels, but as the first billion plus people economy to cross $10,000 per capita income level, its importance in the global economy will only increase in the future.