PwC: China set to overtake US by 2023
Source: Agencies |
June 4, 2011, Saturday
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Print Edition
Print Edition
CHINA could leapfrog the United States to become the world's largest banking economy by 2023, 20 years earlier than expected, raising pressure on Western banks to brush off the effects of the credit crisis and head East.
According to a report published by consultants PricewaterhouseCoopers yesterday, India is expected to leapfrog Japan to rank third in terms of domestic banking by 2035, and could pass China as its population rapidly ages.
PwC's chief economist John Hawksworth urged current banking leaders, whose power has been sapped by the credit crisis, to heed the accelerating shift in global economic power and claim a share of emerging markets' relatively unbanked populations.
"With populations of well over a billion each, access to markets like China and India is critical for growth," he said.
Chinese banks already dominate global rankings by market value, and some lenders have already secured heavy emerging market exposure to tap into booming demand for financial products from young and increasingly wealthy populations.
Banks in the fast-growing emerging markets (E7) of China, India, Brazil, Russia, Mexico, Indonesia and Turkey have been relatively shielded from the financial crisis that brought many Western peers to their knees and sent asset values plunging.
PwC, which based its report on projections for GDP and domestic credit and used net interest margins as a measure of profit, said E7 growth hinged on state investments in infrastructure, opening markets, reducing bureaucracy and budget deficits and increasing rural education.
According to a report published by consultants PricewaterhouseCoopers yesterday, India is expected to leapfrog Japan to rank third in terms of domestic banking by 2035, and could pass China as its population rapidly ages.
PwC's chief economist John Hawksworth urged current banking leaders, whose power has been sapped by the credit crisis, to heed the accelerating shift in global economic power and claim a share of emerging markets' relatively unbanked populations.
"With populations of well over a billion each, access to markets like China and India is critical for growth," he said.
Chinese banks already dominate global rankings by market value, and some lenders have already secured heavy emerging market exposure to tap into booming demand for financial products from young and increasingly wealthy populations.
Banks in the fast-growing emerging markets (E7) of China, India, Brazil, Russia, Mexico, Indonesia and Turkey have been relatively shielded from the financial crisis that brought many Western peers to their knees and sent asset values plunging.
PwC, which based its report on projections for GDP and domestic credit and used net interest margins as a measure of profit, said E7 growth hinged on state investments in infrastructure, opening markets, reducing bureaucracy and budget deficits and increasing rural education.
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