It is the world's No 1 consumer of iron ore and copper and the second-biggest importer of oil. Mainland businesses have embarked on a buying spree for mines and other assets around the world to feed the growing economy.

Analysts said becoming the second-biggest economy would help increase China's global influence but also threw up economic, political and diplomatic challenges.

It also needs to be put in context. Despite the economy's rapid growth, China's per capita output, at just over US$3,000, is less than a tenth that of Japan and it ranks lower than 100th for output per person among the world's 200-plus economies.

'China's emergence as the world's second-biggest economy ... carries symbolic importance and will lend weight to the country's attempts to seek greater influence in international bodies,' said Jing Ulrich, managing director and chairman of JP Morgan's China equities and commodities division.

But Jin Canrong, associate dean of Renmin University's school of international relations, cautioned that while China's growth would help the world recover from the financial crisis, its rising clout and assertiveness would cause more jitters economically and diplomatically.

Jin says Beijing will need to 'go global' to secure the energy and commodities to feed future growth. However, he notes its rising investment and asset purchases overseas, such as the acquisition of mineral assets in Africa, have not always been welcomed. Even mainlanders' purchases of property in Hong Kong had led to fears of an asset bubble, he said.

At the same time China's neighbours were becoming increasingly sensitive to signs of its assertiveness, Jin said, citing Beijing's recent claim that the South China Sea was one of its core national interests.

Jian Chang, China economist with Barclays Capital Research, said China becoming the biggest contributor to global growth affected the patterns of expansion in the world economy.

'China affects the world through its impact on commodity prices, which in turn affect global growth patterns,' Chang said. 'We think development needs will see demand for commodities for years to come.' Chang expects China to add more than 1.2 percentage points to world GDP growth in the next few years.

Japan has held the No 2 spot after the US since 1968, when it overtook the then West Germany.

China's economy will almost certainly be bigger than Japan's at the end of this year because of the big difference in their growth rates. China is growing at about 10 per cent a year while Japan's economy is forecast to grow 3 per cent this year. In the second quarter the Japanese economy grew at an annualised pace of just 0.4 per cent. Most forecasts suggest the Chinese economy will grow between 9 and 11 per cent this year.

Of all the forecasts for China's future growth, Goldman Sachs' is the most optimistic. The bank predicts the mainland will overtake the US by 2027. Professor Niall Ferguson of Harvard University has even predicted the end of 'Chimerica', a term coined to describe the symbiosis of the Chinese and US economies in the past decade. Because of the recession, he predicts the Chinese economy will become more independent of America's.

However, few analysts think China is likely to take top economic spot any time soon. Jing Ulrich at JP Morgan said that even at current growth rates, it would take many years to overtake the US; the gap between China's US$5 trillion economy and the annual US output of nearly US$15 trillion is still large.

'This prospect is further complicated by the fact that, going forward, Chinese leaders will attach more importance to the quality rather than the quantity of growth,' Ulrich said.

Chang at Barclays Capital said China's economic growth would inevitably slow to single digits in the near future despite its double-digit annual growth in the past decade.

'Going forward, we see China's growth slowing to a more sustainable single-digit level, at around 9 per cent in the coming five years and 8 per cent in the 2016-19 period,' she said.

China's growing economic might will add to the pressure on Beijing to allow the yuan's appreciation against other currencies to continue. Many critics see Beijing's policy of export-led growth as the main cause of global trade imbalances.

Still, Chang said the expected reduction in its trade surplus over time should reduce market expectations of, and other countries' pressure for, yuan appreciation.

A long way to go

For all its progress, China's economy is still only a third the size of the US output, at (in US dollars): $5tr