Accurately assessing China's present stage of economic development is important. It determines what can realistically be expected from its economy and provides a yardstick for international comparisons.

The aim of this article is to provide this yardstick not in abstract statistics but in comparison to the development of Asia's two large industrialised economies – Japan and South Korea. Such comparison vindicates the Chinese government's realism, provides encouraging indicators of China's company development, and clears away confusions introduced by some commentators.

To assess China's stage of economic development it is important not to confuse the size of its total GDP with the best indicator of an economy's productivity – its GDP per person. The latter, not the former, determines how developed an economy is.

It is officially recognized that China will overtake the US to become the world's largest economy within 10 years. At market exchange rates this will take place around 2019. On the IMF's latest calculations it is likely in 2016, if the comparison is made taking into account different prices in differing countries.

China overtaking the US to become the world's largest economy will certainly be a turning point in world history – ending 140 years of the US holding that position. But China's huge GDP growth has led some non-Chinese commentators to mistakenly claim that China is no longer a developing country. For example Gideon Rachman, the Financial Times chief foreign affairs columnist, claimed earlier this year: "Anybody who talks regularly to Chinese officials will be familiar with the mantra that 'China is a developing country'. But Shanghai, which I visited last week, mocks this modest description."

The claim that China is a developed, and no longer a developing, country is also used to spread a myth that China's economy is not "creative" – allegedly proved because China has not yet created brands as world famous as Apple or Google. According to British economist Will Hutton, for example, not only China but all of Asia outside Japan is unable to achieve this "creativity". He claims: "The reason why so few Britons can name a great Chinese brand or company… is that there aren't any." And: "Asia, except Japan, remains in essence a subcontractor to the West... China's... is an economy that does not innovate – it is the great copier and counterfeiter of Western technology. This may change over the next 200 years, but not during the lifetime of most of the people reading this column.... Not one of this century's general-purpose technologies will be made outside the West and Japan, which have held a monopoly for 300 years. Their lead will widen rather than narrow."

Actually the reality is China's government is entirely accurate in insisting that China is still a developing country. Even when China's GDP is as big as the US, given that China's population is more than four times that of the US, China's GDP per capita will still only be 23 percent of that of the US. China's very large GDP is important, for example in military defence, but even when China's GDP is the same as that of the US it will still be less developed than the US.