EEMA - World Bank cuts China growth forecast for 2024

2023-10-02 08:31:09 ET

The World Bank cut its forecast for China's economic growth in 2024 and trimmed its outlook for developing economies in East Asia and the Pacific, although the expected easing of global financial conditions will offset the impact of China's slowdown.

Growth in China is projected to be 5.1% in 2023, according to the World Bank , faster than the 3% in 2022 and unchanged from its prior forecast.

But China's growth is estimated to be 4.4% in 2024, lower than the bank's prior outlook of 4.8%, as the economy's rebound has stalled, compounded by the property crisis and longer-term structural factors.

The East Asia and Pacific region is projected to grow 5% in 2023, slightly less than the 5.1% the World Bank had forecast in April. The region is projected to grow 4.5% in 2024.

"While domestic factors are likely to be the dominant influence on growth in China, external factors will have a stronger influence on growth in much of the rest of the region," said the World Bank.

The external factors are slowing global growth, still tight financial conditions, and trade and industrial policies. "Among domestic factors, the most important are the legacy of amplified public and private debt and the macroeconomic policy stance."

Global growth is projected to fall to 2.1% this year, from 3.1% in 2022, but will recover to 2.4% in 2024.

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