China overtake the United States to become the world’s richest country

According to Bloomberg, China has surpassed the United States as the world’s wealth has tripled in the last two decades, with China leading the way and overtaking the US for the top spot.

The research arm of McKinsey & Co. consultants examined the financial sheets of ten distinct countries that account for 60 percent of the world’s total income. The world’s net worth increased to an unprecedented $514 trillion in 2020, up from $156 trillion in 2000, with China accounting for roughly one-third of global revenue.

“We are now wealthier than we have ever been,” Jan Mischke, a partner at the McKinsey Global Institute in Zurich, said in an interview.

According to recent global financial data from McKinsey & Co., China’s wealth has risen to $120 trillion from $7 trillion in 2000, a staggering increase from the country’s days before joining the World Trade Organization, which has hastened its climb to power.

Meanwhile, property values in the United States have remained relatively flat, while the country’s net worth has nearly doubled to $90 trillion in the same time span. Although China and the United States have the world’s greatest economies, the richest 10% of households own the majority of the world’s wealth. According to the research, they’re only becoming richer.

According to the McKinsey analysis, real estate accounts for 68 per cent of global net worth, but it also includes machinery, infrastructure, equipment, and, albeit insignificantly, intangible items such as patents and intellectual property.

The report goes on to say that the only way to deal with these world-historical snags is for the world’s riches to be directed toward more productive investments capable of significantly increasing global GDP. However, if the worst-case scenario occurs, asset prices might plummet, wiping out up to a third of global wealth as the bottom line falls back to equal global income.