News

World Bank trims growth forecast for China

The World Bank has cut its three-year growth forecast for China, while stressing there will be no hard landing for the world’s second largest economy.

In the latest East Asia and Pacific Economic Update published on Monday, the Washington-based institution predicted China’s gross domestic product (GDP) would grow 6.9 percent this year, down from its April forecast of 7.1 percent.

In 2016 and 2017 the Chinese economy would expand at a rate of 6.7 percent and 6.5 percent respectively, down from the previous estimate of 7 percent and 6.9 percent, according to the report.

“The baseline growth projections for China assume a further gradual slowdown in 2016–17… but more sustainable growth is conditioned on continued reforms,” the World Bank said. “China has sufficient policy buffers to address… risks and prevent a sharp slowdown,” it added.

In the first half of this year China’s economy expanded at a rate of 7 percent, the annual target set by the Central Government for the whole of 2015. But some analysts believe the recent run of weak economic data suggests the annual growth rate could dip below that number.

In the same report, the World Bank predicted the non-oil GDP of East Timor would grow 6.8 percent this year before accelerating to 6.9 percent and 7 percent respectively in 2016-17.