World Bank cuts growth forecasts for East Asia, Pacific as China falters
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China's economy will likely expand 4.4 per cent in 2024, down from the 4.8 per cent previously projected, the World Bank said.
PHOTO: BLOOMBERG
JAKARTA – Developing economies in East Asia and the Pacific are set to see slower growth in 2023 and 2024 as the region reels from the impact of tighter finances and a weak global environment, according to the World Bank’s latest report.
Gross domestic product growth is estimated at 5 per cent in 2023 and 4.5 per cent in 2024, the World Bank said in its semi-annual outlook for East Asia and the Pacific. That compares with April forecasts of 5.1 per cent for this year and 4.8 per cent for the next. The latest estimates were still faster than the pace seen in other emerging markets, it said.
China accounts for some of that drag. The world’s second-largest economy will likely expand 4.4 per cent in 2024, down from the 4.8 per cent previously projected, amid property woes, increasing debt and a fading boost from the post-Covid-19 reopening. The 2023 GDP forecast for China was kept at 5.1 per cent.
“What happens in China matters for the whole region,” the report read. “A 1 per cent reduction in its growth is associated with a reduction in regional growth by 0.3 percentage point.”
Excluding China, East Asia and the Pacific should see slightly faster growth in 2024 as the global economy improves and revives foreign demand for the region’s manufactured goods and commodities, the World Bank said.
Geopolitical tensions and possible natural disasters, including extreme weather events, are downside risks to the outlook, it said. BLOOMBERG
