Asian Growth Forecast by Deutsche Bank

This is quite an interesting article published by Deutsche Bank Research. According to the article, China and India will replace Japan as the second largest economy by 2020, with the US staying atop of the ranking.

"India and Malaysia will overtake China to become the world's fastest-growing economies over the next 15 years due mainly to strong population growth. (...) An expected average annual expansion of 5.5 percent in India and 5.4 percent in Malaysia would be largely driven by growing population levels as well as education levels and trade."

"Chinese growth was forecast to average 5.2 percent, only half the 10 percent average growth recorded over the last 20 years.

"The difference between China and India is solely due to the fact population growth is 0.8 percentage points slower in China, where the results of two decades of the one-child-policy begin to show."

Population growth is one of the determining factors in the study, besides education and research, with the importance of research pointed out in this blog earlier.

It is clear that young population is a main factor to growth - their were studies that drew parallels to Japan's stagnant growth in the 1990s to its aged population. In similar vein, Germany is suffering as its population ages. The US, on the other hand, "imports" enough young human capital to keep its growth momentum going - and if only it could assimilate the immigrants into the mainstream, the growth would be even faster.

So, have you taken a look at your population statistics recently?

(By Asia Business Consulting)