World growth and the crisis of the West

The IMF World Economic Outlook 2017 shows that global income will reach $103.2 trillion in 2022.

In inflation adjusted terms this will represent $6.5 trillion of added value. The key factor which underlies the modern crisis in the West, however, is the fact that China, India, Indonesia, South Korea, Turkey, Brazil, Mexico, Iran and Russia will account for 54% of this, whilst the U.S., the Eurozone, Canada and Britain will add only 29%, adding to continuing pressure on the budgets of these countries.

This trend became clearest, according to Stephen Roach, as the world emerged from the financial crisis, and is clearly set to continue. As explained in a previous post, the financialisation of the Western economies that sucked spending power out of the real sector and transferred corporate cost bases to China and other developing countries, is the primary reason for this evident decline of the West.