China is set to overtake the US as the world's largest economy in 2024, 10 years earlier than expected, primarily due to the global financial crisis, Anshu Jain, co-CEO, Deutsche Bank, said on Thursday.
Jain, speaking at a function in Singapore, said that Asia would grow at 7.2% next year, accounting for over 60% of the global GDP growth. "Consumer demand from emerging markets can no longer be ignored. The combined private consumption demand of Asia is already 60% of the US market."
The European debt crisis and the downgrade of US growth prospects remain the key concerns, he said.
"The recent market reaction is a sign of scepticism from investors that the required measures can be both announced and implemented on a timely basis," he said.
Investors dislike uncertainty and have limited patience for a slow resolution, he added.
He, however, said that the US is a key market as it represents 25% of the global GDP and remains the main driver of global demand. A loss of consumer and business confidence and the reduction in household wealth from falling asset prices can have very severe negative economic consequences, he said.
Market reaction could also expedite "further" political unity, especially given the very high and unacceptable cost of a dissolution of the eurozone, Jain said, adding, he was hopeful that a resolution would be found soon.