**Table 1: Population Projections for Latin America and China**

|||**_Levels(millions_**<br>|**_)_**<br>|**_Percentage _**<br>|**_of World_**<br>|
|---|---|---|---|---|---|
|**Year**|**World**|**Latin America**|**China**|**Latin America**|**China**|
|2000|6,123|521|1,269|8.52%|20.73%|
|2005|6,507|557|1,308|8.56%|20.10%|
|2010|6,896|590|1,341|8.56%|19.45%|
|2015|7,284|622|1,370|8.54%|18.80%|
|2020|7,657|652|1,388|8.52%|18.13%|
|2025|8,003|679|1,395|8.48%|17.43%|
|2030|8,321|702|1,393|8.43%|16.74%|
|2035|8,612|720|1,382|8.36%|16.04%|
|Source:|United Natio|ns World Population Pros|pects(2010).|||

42. In parallel to these demographic changes there will be major changes in the structure of the world economy. In the post-war era, the United States, Western Europe, and Japan had been the principle sources for global demand. The United States—a nation with 4.5 percent of the world‘s population—was accountable for a disproportionate 28 percent of the world‘s production in 2010 and an even more disproportionate 33 percent of household consumption. Japan and Western Europe also consumed shares of production disproportionate to their population size. These consumption and production trends became even more pronounced in the years immediately preceding the global financial crisis. Altogether these three regions accounted for 67 percent of global consumption in 2010, while accounting for only 14 percent of the world population.<sup>17</sup> But with the ascent of China as an economic powerhouse the distribution of consumption will be markedly different.

43. What lies in store for future growth prospects in China? One way to gauge the potential is to compare the position of China to that of other emerging economies that caught up rapidly with advanced countries since the end of World War II, in particular South Korea, Taiwan, China and Japan. These economies used their advantage of backwardness<sup>18</sup> to upgrade their technology and industries at a cost advantage, thus achieving a fast rate of structural change and economic growth.

44. In 1979, China had a per capita income that was 6 percent of the per capita income of the United States, when measured in terms of purchasing power parity. In 2008, the per capita income of China was 21 percent of the United States. The current relative status of China to the United States is similar to that of Japan to the United States in 1951, South Korea to the United States in 1977, and Taiwan, China to the United States in 1975. The annual growth rate of GDP averaged 9.2 percent in Japan between the years 1951 and 1971, 7.6 percent in South Korea between the years 1977 and 1997, and 8.3 percent in Taiwan, China between the years 1975 and 1995, and their per capita income increased to 65.6 percent, 50 percent and 54.2 percent of the

> 17 World Bank (2011b).

> 18 The ―advantage of backwardness‖ refers to the fact that countries can benefit from the technological/industrial gap with the advanced countries by adopting and adapting a new technology or entering in an industry that is new to its economy, but mature in the advanced countries to engineer a sequential structural transformation from laborintensive industries (i.e. wood manufactures and clothing) to capital-intensive industries (i.e. machinery and transport equipment).

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