U.S. No Longer Global Biz Leader, There’s a New #1 – China

China leads the world as suggested by this photo of Chinese petrochemical workers

Fortune just published its latest Global 500 ranking of the top companies in the world – and the results this year are earth-shaking. For the first time ever, since this list was launched in 1990, another country has more companies on the list of top companies than the U.S. And the bad news for the White House is that new #1 is China, the country with which it is currently in the midst of a high stakes trade war.

See how China has surpassed the U.S. in global top companies…

As Fortune puts it, “the world’s balance of power is shifting,” and shifting China’s way. On its current list of the 500 leading global companies, China has 129 of the largest corporations in the world by revenue (including 10 companies in Taiwan). The U.S. has 121 of the top global corporations.

Not only is this the first time since 1990 (the year Fortune launched this ranking) that America hasn’t had the top slot for large global corporations – it is most likely the first time since World War II that a country other than the U.S. has led the list, the magazine says. The significance of this achievement is clear to many, as China seeks to supersede the U.S. as the world’s largest superpower.

Business is Taking an Outsized Role

Fortune Global 500 logo

The world of business is taking an outsized role in China’s ambitions, as it seeks to challenge the U.S. for the lead in technological prowess – or as Fortune puts it: “the world’s economic life force: technology. China has boldly set goals to dominate key emerging technology fields, including artificial intelligence, quantum computing, robotics, and autonomous vehicles.

Top 20 Companies from Fortune Global 500

RANK COMPANY REVENUES ($mil) % CHANGE
1 Walmart $514,405 2.8%
2 Sinopec Group $414,649.90 26,85
3 Royal Dutch Shell $396,556 27.2%
4 China National Petroleum $392,976 20.5%
5 State Grid $387,056 10.9%
6 Saudi Aramco $355,905 35.3%
7 BP $303,738 24.2%
8 Exxon Mobile $290,212 18.8%
9 Volkswagon $278,341.50 7%
10 Toyota Motor $272,612 2.8%
11 Apple $265,595 15.9%
12 Berkshire Hathaway $247,837 2.4%
13 Amazon.com $232,887 30.9%
14 UnitedHealth Group $226,247 12.5%
15 Samsung Electronics $221,579.40 4.5%
16 Glencore $219,754 6.9%
17 McKesson $214,319 2.9%
18 Daimler $197,515.30 6.6%
19 CVS Health $194,579 5.3%
20 Total $184,106 23.5%

China is not just talking the talk, they are walking the walk – as Strata-gee recently reported the country is outspending the world with massive government directed investments in artificial intelligence and the other technologies. And in a age when U.S. companies international patent filings are actually declining 0.9% in 2018, China filed 9.1% more international patents and as #2, they are breathing down the neck of the U.S.

China’s Star is Rising

The stakes are high – and China is playing the long game. President Xi Jinping has publicly said that by 2049 – the centennial of the communist revolution – China will be “fully developed, rich, and powerful.” China expert Graham Allison of Harvard told Fortune that in this goal, Xi means to be “unambiguously No. 1,” with a military “that can take on and defeat all adversaries.”

Whether Xi and China meets all of these goals remains to be seen. But right now…China is ascendant.

See the entire Fortune Global 500 list here…


Comments

U.S. No Longer Global Biz Leader, There’s a New #1 – China — 6 Comments

  1. There is no doubt China is rising. However, to put it in context there is still a giant value delta in place. There are several reasons for this. One is that these lists only cover the top line revenue. Some of these firms total gross margins are under 10%, so the bulk of the actual profits still are in the US. As well, many of the China firms are state owned or supported. There are ample reasons there to have some skepticism around the quoted numbers. For example, while China is still reporting over 6% GDP growth, none of my Chinese friends believe it and say you must give significant “haircuts” to the numbers.
    All of that said, the world is indeed much more flat than in the past, and it will take skill and execution to compete more than ever. Thanks Ted.

    • Thanks for your thoughts Robert… All that you say is true. And for sure, if you used a different yardstick (I.e. corporate profits) you would likely get a different result.

      But it’s a fools errand to ignore the ascendancy of China. Fortune has used this same yardstick for years, and for years there were more US companies than there were for any other country. That fact is no longer the case…and no matter the reason, THAT is significant.

      As you may know, I monitor the media around the world and this news is hitting pretty big. From economic leadership comes strong influence. China’s influence is growing.

      Thanks for reading!

      Ted

  2. China is a demographic train wreck in progress. If you start looking at their long-term demographic situation they seem a lot less threatening. The inevitable decline is very much in sight.

      • Very low birth rates, aging population and all happening before they become a relatively wealthy country. There are a lot of articles out there from a bunch of different sources. When I was a kid Japan was going to take over the world. There was endless hysteria about it but they only made it so far before the various consequences of their workaholic culture stagnated them. I think China has more problems on the horizon than Japan ever did.

        “The crux of China’s demographic challenge lies in the fact that, unlike Japan, South Korea, the United States and Western European countries, China’s population will grow old before the majority of it is anywhere near middle-income status, let alone rich. This is historically unprecedented, and its implications are made all the more unpredictable by its coinciding with the Chinese economy’s forced shift away from an economic model grounded in the exploitation of inexhaustibly cheap labor ”

        https://worldview.stratfor.com/article/china-unprecedented-demographic-problem-takes-shape

        • Joe,

          Thanks for this added detail. My guess is that – like many things in life – the truth is somewhere in the middle. Hyper-concern over China’s growth is not productive…but complacency over its growing influence is not smart either.

          Great food for thought Joe…Thanks!

          Ted

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