The World’s Largest Economies: Comparing The U.S. And China -

The World’s Largest Economies: Comparing The U.S. And China

Jun 03, 2024Jeremy ParkinsonFinance0

Comparing the Economies of the U.S. and China in 3 Key Metrics
In this graphic, we provide insight into the world’s two biggest economies by comparing them across three key metrics: GDP, equity market valuation, and foreign direct investment (FDI).Starting with GDP, we used 2024 estimates from the latest edition of the IMF’s World Economic Outlook (April 2024):

Country GDP (% of total) GDP (USD billions) The U.S. 26.3 $28,780 China 16.9 $18,530 Rest of World 56.8 $62,220

Based on these figures, the United States and China combine for a massive 43.2% share of the global economy.It’s also interesting to note that America’s share of global GDP has actually been increasing in recent years, from a low of 21.1% in 2011. This is partly due to its relatively strong recovery from the COVID-19 pandemic.
Equity Market ValuationThe U.S. dominates when it comes to stock market valuation, accounting for 61% of the global total as of Feb. 29, 2024. These figures are based on each country’s share of the S&P Global BMI, which is a broad coverage index, including large, mid, and small-cap stocks from developed and emerging markets.

Country % of Global Market Cap The U.S. 61.0 China 2.8 Rest of World 36.2

The massive disparity in equity market valuations between the U.S. and China is a result of differences in many factors, including market maturity, corporate governance, and international participation.In terms of country rankings within the S&P Global BMI, China is the fourth largest (behind Japan and the UK).
Foreign Direct InvestmentFDI is an investment made by a firm or individual in one country into business interests located in another country. This type of investment can be very beneficial because it can create jobs and enhance economic growth. The FDI figures in this graphic were sourced from fDi Intelligence, and represent cumulative FDI stock from 1990 to 2022.

Country % of Global FDI FDI (current USD) The U.S. 23.7 $10.5T China 8.6 $3.8T Rest of World 67.7 $30.0T

The U.S. and China are first and second in terms of cumulative FDI stock. Attracting FDI is one area where China has performed very strongly in recent years.For example, in 2012, China had attracted $950 billion in FDI, good enough for sixth place. As of 2022, China’s total had grown to $3.8 trillion, a testament to its attractiveness to global businesses, even in the face of regulatory challenges and geopolitical tensions.More By This Author:Visualizing Cobalt Production By Country In 2023
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