How China Overtook the U.S. as the World's Major Trading Partner
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How China Overtook the U.S. as the World’s Major Trading Partner

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How China Overtook the U.S. As the World’s Trade Partner

In 2018, trade accounted for 59% of global GDP, up nearly 1.5 times since 1980.

Over this timeframe, international trade has transformed significantly—not just in terms of volume and composition, but also in terms of the countries that the rest of the world leans on for their most important trade relationships.

Now, a critical shift is occurring in the landscape, and it may surprise you to learn that China has already usurped the U.S. as the world’s most dominant trading partner.

Trading Places: A Global Shift

Today’s animation comes from the Lowy Institute, and it pulls data from the International Monetary Fund (IMF) database on bilateral trade flows, to determine whether the U.S. or China is a bigger trading partner for each country from 1980 to 2018.

The results are stark: before 2000, the U.S. was at the helm of global trade, as over 80% of countries traded with the U.S. more than they did with China. By 2018, that number had dropped sharply to just 30%, as China swiftly took top position in 128 of 190 countries.

The researchers pinpoint China’s 2001 entry into the World Trade Organization as a major turning point in China’s international trade relationships. The dramatic shift that followed is clearly demonstrated in the visualization above—between 2005 and 2010, a number of countries tipped towards Chinese influence, especially in Africa and Asia.

Over time, China’s dominance has grown dramatically. It’s no wonder then, that China and the U.S. have a contentious trade relationship themselves, as both nations battle it out for first place.

A Tale of Two Economies

The United States and China are competitors in many ways, but to be successful they must rely on each other for mutually beneficial trade. However, it’s also the major issue on which they are struggling to reach a common ground.

The U.S. has been vocal about negotiating more balanced trade agreements with China. In fact, a mid-2018 poll shows that 62% of Americans consider their trade relationship with China to be unfair.

Since 2018, both parties have faced a fraught relationship, imposing major tariffs on consumer and industrial goods—and retaliations are reaching greater and greater heights:

trade war china us

While a delicate truce has been reached at the moment, the trade war has caused a significant drag on global growth, and the World Bank estimates it will continue to have an effect into 2021.

At the same time, China’s sphere of influence continues to grow.

One Belt, One Road, One Trade Direction?

China seems to have a finger in every pie. The nation is financing a flurry of megaprojects across Asia and Africa—but one broader initiative stands above the rest.

China’s “One Belt, One Road” (OBOR) Initiative, planned for a 2049 completion, is advancing at a furious pace. In 2019 alone, Chinese companies signed contracts worth up to $128 billion to start Chinese large-scale infrastructure projects in various countries.

While building new highways and ports abroad is beneficial for Chinese financiers, OBOR is also about creating new markets and trade routes for Chinese goods in Asia. Recent research found that the OBOR program’s infrastructure expansion and logistics performance improvements led to positive effects on China’s exports.

Nevertheless, it’s clear the new infrastructure network is already transforming global trade, possibly cementing China’s position as the world’s major trading partner for years to come.

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This Simple Chart Reveals the Distribution Of Global Wealth

Global wealth at the end of 2020 was about $418 trillion. Here’s a breakdown of the global wealth distribution among the adult population.

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The Global Wealth Distribution in One Chart

The pandemic resulted in global wealth taking a significant dip in the first part of 2020. By the end of March, global household wealth had already declined by around 4.4%.

Interestingly, after much monetary and fiscal stimulus from governments around the world, global household wealth was more than able to recover, finishing up the year at $418.3 trillion, a 7.4% gain from the previous year.

Using data from Credit Suisse, this graphic looks at how global wealth is distributed among the adult population.

How is Global Wealth Distributed?

While individuals worth more than $1 million constitute just 1.1% of the world’s population, they hold 45.8% of global wealth.

Wealth RangeWealthGlobal Share (%)Adult Population
Over $1M$191.6 trillion45.8%Held by 1.1%
$100k-$1M$163.9 trillion39.1%Held by 11.1%
$10k-$100k$57.3 trillion13.7%Held by 32.8%
Less than $10k$5.5 trillion1.3%Held by 55.0%
Total$418.3 trillion100.0%Held by 100.0%

On the other end of the spectrum, 55% of the population owns only 1.3% of global wealth.

And between these two extreme wealth distribution cases, the rest of the world’s population has a combined 52.8% of the wealth.

Global Wealth Distribution by Region

While wealth inequality is especially evident within the wealth ranges mentioned above, these differences can also be seen on a more regional basis between countries.

In 2020, total wealth rose by $12.4 trillion in North America and $9.2 trillion in Europe. These two regions accounted for the bulk of the wealth gains, with China adding another $4.2 trillion and the Asia-Pacific region (excluding China and India) another $4.7 trillion.

Here is a breakdown of global wealth distribution by region:

RegionTotal Wealth
(US$B)
Change in Total Wealth
(US$B)
Change %Wealth Per Adult
(US$B)
Change %
North America136,31612,37010.0486,9309.1
Europe103,2139,1799.8174,8369.8
Asia-Pacific75,2774,6946.760,7905.0
China74,8844,2466.067,7715.4
India12,833-594-4.414,252-6.1
Latin America10,872-1,215-10.124,301-11.4
Africa4,946360.77,371-2.1
World418,34228,7167.479,9526.0

India and Latin America both recorded losses in 2020.

Total wealth fell in India by $594 billion, or 4.4%. Meanwhile, Latin America appears to have been the worst-performing region, with total wealth dropping by 11.4% or $1.2 trillion.

Post-COVID Global Outlook 2020-2025

Despite the burden of COVID-19 on the global economy, the world can expect robust GDP growth in the coming years, especially in 2021. The latest estimates by the International Monetary Fund in April 2021 suggest that global GDP in 2021 will total $100.1 trillion in nominal terms, up by 4.1% compared to last year.

The link in normal times between GDP growth and household wealth growth, combined with the expected rapid return of economic activity to its pre-pandemic levels, suggests that global wealth could grow again at a fast pace. According to Credit Suisse estimates, global wealth may rise by 39% over the next five years.

Low and middle-income countries will also play an essential role in the coming year. They are responsible for 42% of the growth, even though they account for just 33% of current wealth.

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Mapping The Biggest Companies By Market Cap in 60 Countries

Tech, finance or energy giant? We mapped the biggest companies by market cap and industry.

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Mapping The Biggest Companies By Market Cap in 60 Countries Share

The Biggest Companies By Market Cap in 60 Countries

Tech giants are increasingly making up more of the Fortune 500, but the world’s biggest companies by market cap aren’t so cut and dry.

Despite accounting for the largest market caps worldwide—with trillion-dollar companies like Apple and contenders including Tencent and Samsung—tech wealth is largely concentrated in just a handful of countries.

So what are the biggest companies in each country? We mapped the largest company by market cap across 60 countries in August 2021 using market data from CompaniesMarketCap, TradingView, and MarketScreener.

What are the Largest Companies in the World?

The world has 60+ stock exchanges, and each one has a top company. We looked at the largest local company, since many of the world’s largest firms trade on multiple exchanges, and converted market cap to USD.

CountryCompanyIndustryMarket Cap (August 2021)
USAAppleTechnology$2.5T
Saudi ArabiaSaudi AramcoEnergy$1.9T
TaiwanTSMCTechnology$594.5B
ChinaTencentTechnology$554.0B
South KoreaSamsungTechnology$429.7B
FranceLVMHConsumer Cyclical$414.3B
SwitzerlandRocheHealthcare$350.0B
NetherlandsASMLTechnology$322.6B
JapanToyotaConsumer Cyclical$251.6B
DenmarkNovo NordiskHealthcare$236.7B
IrelandAccentureTechnology$208.2B
IndiaReliance IndustriesEnergy$198.1B
AustraliaBHP GroupMaterials$191.7B
CanadaShopifyTechnology$185.7B
UKAstrazenecaHealthcare$182.0B
GermanySAPTechnology$174.6B
SingaporeSEATechnology$152.3B
Hong KongAIAFinancials$146.4B
BelgiumAnheuser-Busch InbevConsumer Staples$122.7B
SpainInditexConsumer Cyclical$108.3B
BrazilVALEMaterials$103.9B
RussiaSberbankFinancials$96.7B
ItalyEnelUtilities$93.7B
ArgentinaMercadoLibreConsumer Cyclical$89.5B
SwedenAtlas CopcoIndustrials$84.1B
South AfricaNaspersTechnology$74.1B
NorwayEquinorEnergy$67.9B
UAEEtisalatCommunication$58.7B
MexicoWalmexConsumer Staples$58.1B
IndonesiaBank Cental AsiaFinancials$54.8B
KazakhstanKaspi.kzFinancials$49.8B
QatarQNBFinancials$48.2B
FinlandNordea BankFinancials$48.0B
LuxembourgArcelorMittalMaterials$36.3B
AustriaVerbundUtilities$33.7B
ThailandPTT PCLEnergy$30.1B
ColombiaEcopetrolEnergy$26.7B
MalaysiaMaybankFinancials$23.7B
PhilippinesSM InvestmentsConsumer Cyclical$22.9B
KuwaitKuwait Finance HouseFinancials$21.9B
PortugalEDP GroupUtilities$21.0B
VietnamVinhomesReal Estate$17.1B
IsraelNICETechnology$16.9B
KenyaSafaricomCommunication$16.0B
Czech RepublicÄŒEZ GroupEnergy$15.8B
New ZealandXeroTechnology$15.8B
TurkeyQNB FinansbankFinancials$15.8B
HungaryOTP BankFinancials$15.6B
ChileEnel AmericasUtilities$14.3B
MoroccoMaroc TelecomCommunication$13.6B
PolandPKO Bank PolskiFinancials$12.6B
CyprusPolymetalMaterials$10.0B
NigeriaDangote GroupMaterials$10.0B
BahrainAhli United BankFinancials$8.6B
GreeceOTE GroupCommunication$8.4B
PeruCredicorpFinancials$8.0B
EgyptCommercial International BankFinancials$5.9B
IcelandMarelIndustrials$5.8B
OmanBank MuscatFinancials$4.2B
PanamaCopa HoldingsIndustrials$3.1B

Many are former monopolies or massive conglomerates that have grown in the public space, such as South Africa’s Naspers and India’s Reliance Industries.

Others are local subsidiaries of foreign corporations, including Mexico’s Walmex, Chile’s Enel and Turkey’s QNB Finansbank.

But even more noticeable is the economic discrepancy. Apple and Saudi Aramco are worth trillions of dollars, while the smallest companies we tracked—including Panama’s Copa Group and Oman’s Bank Muscat—are worth less than $5 billion.

Finance and Tech Dominate The Biggest Companies By Market Cap

Across the board, the largest companies were able to accumulate wealth and value.

Some are newer to the top thanks to recent success. Canada’s Shopify has become one of the world’s largest e-commerce providers, and the UK’s AstraZeneca developed one of the world’s COVID-19 vaccines.

But the reality is most companies here are old guards that grew on existing resources, or in the case of banks, accumulated wealth.

IndustryBiggest Companies by Country
Financials16
Technology12
Energy6
Materials5
Communication4
Consumer Cyclical4
Utilities4
Healthcare3
Industrials3
Consumer Staples2
Real Estate1

Banks were the most commonly found at the top of each country’s stock market. Closely behind were oil and gas giants, mining companies, and former state-owned corporations that drove most of a country’s wealth generation.

But as more economies develop and catch up to Western economies (where tech is dominant), newer innovative companies will likely put up a fight for each country’s top company crown.

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