China to become high-income country by next year, the second country after S.Korea moved from low to high-income since the second world war28TH JAN 2022
China is likely to become a high-income country by next year, economists said yesterday.
In 2021 per capita income reached $12,551 (£9,380), not far shy of the World Bank definition of a high-income country ($12,695).
China’s zero-Covid policy, using strict localised lockdowns and mass testing with isolation and support to prevent the spread of coronavirus, has enabled it to avoid national lockdowns or major waves of sickness, meaning it was among the few economies to record continuing growth in 2020, which sped up in 2021.
While many low-income countries (defined as having per capita income of under $1,046 in 2021) have become middle-income countries, China would only be the second to move from low to high-income since the second world war, after South Korea.
The World Bank has described a “middle income trap” in which developing countries’ labour becomes more expensive, deterring investment, though critics ascribe underdevelopment to the domination of many economies by Western transnationals which channel profits away from them.