CESifo Forum 1/200715 Focus THE IMPACT OF CHINA AND INDIA ON THE DEVELOPING WORLD

The global economy is undergoing a profoundand momentous shift. The first half of the 21st century will undoubtedly be dominated by the con-sequences of a new Asian dynamism. China is likely to become the second biggest economy in the world by 2016, and India the third largest by 2035. A clus-ter of other countries in the Asian region, such as Thailand and Vietnam, are also growing rapidly. These newly dynamic Asian economies can collec-tively be characterised as the “Asian Drivers of Global Change”. The economic processes they engender are likely to radically transform regional and global economic, political and social interactions and to have a major impact on the environment.This is a critical “disruption ” to the global economic and political order that has held sway for the past fiv