January 25, a study by Prognos, a German research and consulting agency, showed that the focus of the world economy is shifting.
In 2040, the total economy of Asia will exceed that of North, Western and Central Europe combined, with East Asia and the Western Pacific regions increasing the most, while the largest economy and power source of the Asia-Pacific region is China.
Europe and the United States will obviously lose their dominance in the global economy.
On January 25, an analysis conducted by Prognos, a German research and advisory agency, on behalf of the Bavarian Economic Federation (vbw), showed that the world will usher in “demographic and economic transformation” in the next 20 years, in which the Asia-Pacific economic field will catch up.
“Deglobalization is very fatal to the world economy”
The report is mainly divided into two parts, that is, the analysis of the current situation of the world economy and politics and the prediction of future development.
From an economic perspective, researchers analyzed the expected development of consumption, investment and infrastructure in various regions of the world, according to which they believe that the “central and western” (North America plus Western and Central Europe) of the world are gradually losing economic importance.
But it is still an important sales market, because of the high start.
In contrast to the former, East Asia and the Pacific and parts of South Asia have great economic growth potential to some extent, while German and Bavarian companies have a strong market position in these growth markets, especially in the field of automobile manufacturing and medical technology.
There is still development potential in other market segments, especially in the Chinese market.
Researchers believe that the transformation of economic energy will also change the political situation. The current world trade order is essentially shaped by Western countries, that is, those regions that will lose their economic importance.
Coupled with long-standing globalization skepticism and growing trade protectionism, world trends may have the potential risk of deglobalization because of these two. As a highly international economy, this will have a very negative impact on Germany and Bavaria.
The report also wrote that the total economic volume of Asia will exceed that of North America, Western Europe and Central Europe combined in 2040, with East Asia and the Western Pacific regions increasing the most, while China, the largest economy and power source in the Asia-Pacific region.
Therefore, the research institute predicts that the balance of world economic power will shift from west to east, which may mean that new rules will usher in international economic exchanges.
Changes in economic power comparison may lead to the world being divided into two parts, mainly China and the United States, and gradually moving away from multipolarity.
Faced with this change, Michael Böhmer, the author of the study, pointed out that the best way to maintain prosperity is not to let this happen: “Going globalization will be very deadly to the world economy.” He said that free trade and the international division of labor of the global economic order are the foundation of existing and sustainable prosperity, but the protectionism, tariff wars and industrial subsidies and technical barriers launched by the United States have harmed all participants in the globalized economy.
In response, Bertram Brossardt, director-general of the Bavarian Economic Union, explained that German economists and politicians are worried that the trade conflict between China and the United States may lead to a long-term confrontation between the two countries. At that time, the world economy will be in a state of turmoil and the power ratio will change.
If Europe joins the U.S.-led group, it may lose 22% of exports and 30% of imports; if Europe approaches China, exports may be reduced by 18%; if the EU chooses non-alignment as the third option and acts as an independent force between China and the United States, it is estimated that there will still be a 12% export loss.
“We have no choice but to accept the international division of labor between free trade and the global economic order,” Brossard said.
American think tank: Eastern powers are accelerating their running
In addition to concerns about the future development path of the EU, the report highlights the judgment of economic development in the Asia-Pacific region led by China – “Many emerging countries, especially those in Asia, are undergoing a dynamic catch-up process”.
For example, East Asia and the Pacific will “increase economic power”, and the region’s most important driving force is China.
The report also mentioned that according to data provided by a think tank in the United States, China may throw the whole EU behind in the important technology field of artificial intelligence.
According to a study released by the Information Technology and Innovation Foundation on January 25, the United States, due to the research invested and the high investment in investment in start-ups, the United States Although it is still in the leading position in the field of artificial intelligence, China has begun to catch up in this field and want to catch up.
The IT and Innovation Foundation’s study uses 30 separate indicators to assess AI, including talent, research activities, business development, and hardware and software investments.
The report shows that the United States led the way with 44.6 points under the percentage system, followed by China with 32 points, and the European Union ranked third with 23.3 points.
Researchers found that the United States is leading in key areas such as venture capital and R&D funding. But China has made great progress in several other fields.
Last year, of the world’s 500 most powerful supercomputers, China had 214 more supercomputers than any other country, compared with 113 in the United States and 91 in the European Union. Moreover, China published about 24,929 artificial intelligence research papers in 2018, with 20,418 in the European Union and 16,233 in the United States in this regard.
According to the Research of Prognos, German and Bavarian companies are only partially prepared for these long-term changes in the global economic situation.
“In the vehicle and medical product category, our company has taken a strong position in the most important sales markets in East Asia, the Pacific and North America.
And in terms of machine and systems exports, road and energy infrastructure exports, German exporters have so far only met the purchasing market in East Asia and the Pacific, while there is still room for demand in the future in North America and South Asia.” “This means there are still opportunities for growth in these areas,” Brossard said.