NEW YORK (CNNMoney.com) -- China has surpassed Japan to become the world's second largest economy, lagging only behind the United States, a Chinese government official said in remarks published on Friday.
Yi Gang, China's chief currency regulator, broke the news in an interview with China Reform magazine, which was posted on the website of his agency, State Administration of Foreign Exchange.
Japan has yet to announce its gross domestic product for the second quarter, however. Many economists also are likely to base official rankings for world economies on annual data. But few doubt that China has already achieved the milestone of becoming the second-largest economy.
In 2009, China's nominal gross domestic product was worth $4.9 trillion, just 3% smaller than Japan's at $5.1 trillion. The United States still has, by far, the world's largest economy. Its GDP was $14.3 trillion in 2009.
China's economy grew at a pace of 11.1% in the first half of the year, Chinese officials said earlier this month, and for the full year, the International Monetary Fund expects the country to post a growth rate of 10.5%.
Meanwhile, the Japanese economy is only expected to rise at a rate of 2.4% for the current year.
"Japan is a mature economy. Like the United States, it is at a frontier of what's possible in terms of economic development and has to rely on innovation to grow," said Todd Lee, managing director of the Greater China division at research firm IHS Global Insight. "China has a lot of room for catch-up growth, which is what we've been seeing for the last 30 years."
Thanks to its significantly larger population and the decision to allow the yuan to trade freely against the dollar, China could eventually top the United States as the world's largest economy.
It will probably be at least a decade before that happens, though. Lee expects China to surpass the United States before 2025, but added that it could happen sooner rather than later if China continues to let the yuan appreciate.
|Overnight Avg Rate||Latest||Change||Last Week|
|30 yr fixed||3.44%||3.44%|
|15 yr fixed||2.70%||2.69%|
|30 yr refi||3.46%||3.45%|
|15 yr refi||2.74%||2.72%|
Today's featured rates:
HSBC banker arrested at JFK airport as he prepared to leave the country. He and former trader face federal charges they manipulated currency trades. More
Bernie Sanders takes credit for forcing for forcing Hillary Clinton and the entire Democratic Party to get a lot tougher on Wall Street. But how likely is that to happen? More
This is where Tesla plans to build enough lithium ion batteries to catapult Tesla's electric vehicles into the mainstream. More
In 1998, Ntsiki Biyela won a scholarship to study wine making. Now she's about to launch her own brand. More
Only 3% of employers offer so-called "vacation stipends" that help pay for their employees' vacations. But those that do make taking time off a must. More