The World’s Largest Economies: Comparing the U.S. and China

Starting with GDP, we used 2024 estimates from the latest edition of the IMF’s World Economic Outlook (April 2024).

According to the IMF’s World Economic Outlook for April 2024, the United States is projected to contribute 26.3% of the global GDP, amounting to $28,780 billion. China follows with 16.9% and $18,530 billion. The rest of the world collectively accounts for 56.8% with $62,220 billion.

Based on these figures, the United States and China combine for a massive 43.2% share of the global economy.

It’s also interesting to note that America’s share of global GDP has actually been increasing in recent years, from a low of 21.1% in 2011. This is partly due to its relatively strong recovery from the COVID-19 pandemic.

Equity Market Valuation

The U.S. dominates when it comes to stock market valuation, accounting for 61% of the global total as of Feb. 29, 2024.

The massive disparity in equity market valuations between the U.S. and China is a result of differences in many factors, including market maturity, corporate governance, and international participation.

In terms of country rankings within the S&P Global BMI, China is the fourth largest (behind Japan and the UK).

Foreign Direct Investment

FDI is an investment made by a firm or individual in one country into business interests located in another country. This type of investment can be very beneficial because it can create jobs and enhance economic growth.

The U.S. and China are first and second in terms of cumulative FDI stock. Attracting FDI is one area where China has performed very strongly in recent years.

For example, in 2012, China had attracted $950 billion in FDI, good enough for sixth place. As of 2022, China’s total had grown to $3.8 trillion, a testament to its attractiveness to global businesses, even in the face of regulatory challenges and geopolitical tensions.