SINGAPORE (REUTERS) - The World Bank slightly raised its 2016 economic growth forecast for developing East Asia and the Pacific on Wednesday (Oct 5), saying that Brexit is unlikely to have any significant near-term impact on growth in the region.
The Washington-based lender now expects the developing East Asia and Pacific (EAP) region, which includes China, to grow 6.4 per cent in 2016 and 6.2 per cent in 2017.
Its previous forecast in April was for 6.3 per cent growth in 2016 and 6.2 per cent in 2017.
"Growth in the region is expected to remain broadly resilient during 2016-2018," the World Bank said in its latest East Asia and Pacific Economic Update report.
The bank kept its 2016 and 2017 growth forecasts for China unchanged at 6.7 per cent and 6.5 per cent, respectively, but trimmed its 2018 growth view for China by 0.2 percentage point to 6.3 per cent.
Growth projections for Thailand were raised to 3.1 per cent for both 2016 and 2017, up from 2.5 per cent and 2.6 per cent previously.
"In Thailand, growth will recover gradually to 3.3 per cent in 2018, reflecting the effects of increased public investment, improving consumer confidence, and continued expansion in services including tourism," the World Bank said.
But it said its baseline view for the region faces significant risks such as China's ongoing economic slowdown and any sharp tightening in global financial conditions that could reduce capital flows to the region.
Britain's looming separation from the European Union is unlikely to have a large impact on developing East Asia and the Pacific in the short-term, the bank added, given the region's limited direct trade and financial links with the United Kingdom.
The UK accounts for less than 2 per cent of total exports across most of developing East Asia and Pacific, and accounts for a limited share of total foreign direct investment flows to the region, the bank said.
"In the medium term, Brexit will imply a renegotiation of developing EAP's trade and investment agreements with the United Kingdom, and may also affect their trade relations with the European Union."