BEIJING, Jan 14: China passed another milestone in its stunning rise on Wednesday when new data showed it had leapfrogged Germany in 2007 to become the world’s third-largest economy.

That puts China, whose economy has grown tenfold in 30 years, behind just the United States and Japan in terms of gross domestic product.

“I think it will take only three to four years for China to overtake Japan as the second-largest economy in the world,” said Merrill Lynch economist Ting Lu. But catching up with the United States could take decades, he said.

China’s new rank came after the government revised its estimate of 2007 growth from an already high 11.9 per cent to 13 per cent, the fastest rate since 1994.

The national statistics bureau’s two-sentence statement on Wednesday did not explain the factors behind the latest change. China routinely revises past data as it gathers new information on the fast-changing economy and already had raised 2007 growth once last spring, from 11.3 per cent to 11.9 per cent.

The new revision raised the gross domestic product to 25.7 trillion yuan, the statistics bureau said, or $3.5 trillion at 2007 exchange rates. That would be ahead of Germany’s 2007 GDP of 2.4 trillion euros, or $3.3 trillion at an exchange rate produced by averaging rates on the 15th of each month during that year.

Based just on Dec 31, 2007, exchange rates, China was slightly behind Germany but would have passed it early last year.

The revision comes as Beijing struggles to reverse an economic slump caused by global turmoil and prevent already simmering social unrest over lost export-related jobs.

The government is launching a 4-trillion-yuan ($586 billion) stimulus package and is promising to help struggling exporters. China’s exports fell at their fastest rate in a decade last month. On Wednesday, the cabinet cut fuel prices and a tax on auto sales.

The change in economic ranking won’t help China out of its slump, said Moody’s Economy.com analyst Sherman Chan. “The only effect is perhaps negative, as a stronger 2007 would make the 2008 slowdown more upsetting,” Chan said in a report.

The United States is the world’s biggest economy at $13.8 trillion in 2007, followed by Japan at $4.4 trillion.

Germany’s 85 million people were still far ahead of China in GDP per person in 2007 at 28,200 euros ($38,800).

China’s GDP per person was 19,800 yuan ($2,800) in 2007, but the country has wide disparities of wealth and poverty, and many live on far less than that. Chinese officials say more than 100 other countries have a higher income per person.

Then-supreme leader Deng Xiaoping set China on the road from communist central planning to a market-style economy in 1979. That year’s GDP was just $300 billion — one-tenth of the 2007 level — according to the International Monetary Fund.

Over three decades, hundreds of millions of people have lifted themselves out of poverty and major cities have been transformed into forests of skyscrapers and modern apartment blocks, with streets jammed with private cars.

Independent economists say China’s economy is believed to have grown by another 9 per cent in 2008 despite the global downturn. Figures for 2008 are expected to be released this month.

But economists have slashed 2009 forecasts to as low as 6 per cent. That would be the highest for any major economy but is worrisome for communist leaders who need to satisfy a public that expects steadily rising incomes and is already restive over thousands of recent manufacturing layoffs.—AP