The U.S., China, and the U.K are among the top economies in the world. Each of them contributes substantially to international economic growth, trade, and financial stability. According to Kavan Choksi, each of these nations has distinctive strengths and economic roles that impact everything from trade flows to currency valuation and influencing global economic trends.
Kavan Choksi Sheds Light on The Economy of the US, UK and China
The economy of the United States is the world’s largest. It is worth over a quarter of global GDP in nominal USD. It also has among the highest GDPs per capita in the planet. The structure of the United States is highly diversified. The tech industry of the country is anchored by Silicon Valley, and drives innovation in AI, biotech and software. The financial sector of the US is centered in New York and boasts of the deepest capital markets in the world. Pharmaceuticals and healthcare are some of the other strengths of the United States. The manufacturing sector in the US are also quite competitive, along with defence, aerospace and motor vehicles.
The gap between the United States and other major advanced economies has widened since the Covid-19 pandemic. This happened due to a strong dollar value and the persistent economic outperformance of the country. This outperformance is likely to continue going forward.
China is the second largest economy in the world. It is worth close to 20% of global GDP in nominal USD. China is powered by export-led manufacturing and investment. It is widely known as the “world’s factory.” China is a leading producer of textiles, machinery and electronics. The government of China has prioritized technological self-reliance and improved value-added activities. It has showered domestic industries with state support and subsidies, while restricting the participation of foreign firms in certain sensitive areas of the economy. This environment has led to the rise of competitive domestic giants in technology and BYD in electric vehicles. In recent years, multiple Chinese companies have expanded into international markets, raising concerns in Western countries. Additionally, government support has propelled China to lead in green technology. For instance, Chinese companies produce most of the world’s solar panels. In comparison to the United States, the economic growth in China has slowed since 2021 due to the yuan’s depreciation against the dollar and strong economic performance in the US. While convergence with the United States economy is expected to continue, it will likely be at a slower pace as China’s growth potential moderates.
In the opinion of Kavan Choksi, the United Kingdom’s economy is primarily service-oriented. In its economy, insurance, finance, and real estate play an important role. Other important sectors include creative industries, defence, higher education, automotive, and pharmaceuticals. The United Kingdom benefits from a flexible labour market and a robust education system. UK gross domestic product is estimated to have increased by 0.1% in the 3rd quarter of 2024, following growth of 0.5% in the 2nd quarter. Its GDP is estimated to have increased by 1.0% in the 3rd quarter of 2024, compared with the same quarter a year ago.