China set for slower growth, World Bank warns

8 October 2012

A combination of poorer investment growth and weaker exports demand has resulted in the World Bank deciding to lower its economic expansion forecast for China.

In a new report published today (8 October), the institution has opted to downgrade its estimated growth in the Asian superpower from the level of 8.2 per cent recorded in May to 7.7 per cent.

The East Asia and Pacific Data Monitor indicated that the country has experienced a "significant" slowdown so far in 2012 thanks to issues both at home and abroad and warned that this could "accelerate" further before the end of the year.

Fiscal problems in the US and the eurozone have stifled demand from China's major trading partners for its exports, while government measures designed to boost domestic conditions have not proved massively successful.

"Economic momentum is expected to be weak during the coming months with limited policy easing, a property market correction and faltering external demands," the World Bank added.

By Asim Shah

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