The World Bank has revised down its growth estimates for developing countries in East Asia and the Pacific due to financial stress and a weak global environment. The gross domestic product (GDP) growth in the region is now projected to be 5% in 2023 and 4.5% in 2024, down from previous forecasts of 5.1% for this year and 4.8% for the next.

China’s GDP growth for 2023 is estimated at 5.1%, while the rest of the region, excluding China, is expected to grow at 4.6%. Growth in Pacific Island Countries is projected to be 5.2%. However, China’s GDP growth estimates for 2024 have been lowered to 4.4% from the previous projection of 4.8%.

The World Bank cites persistent domestic difficulties in China, including debt, weakness in the property sector, and structural factors such as aging, as factors weighing on its growth. The rest of the region is expected to see growth of 4.7% in 2024, boosted by global growth recovery and improved financial conditions.

The report emphasizes that China’s economic performance has significant implications for the entire region, with a 1% reduction in China’s growth associated with a 0.3 percentage point reduction in regional growth. Excluding China, East Asia and the Pacific are expected to experience slightly faster growth in 2024, driven by increased global demand for the region’s goods and commodities.

Despite the moderation in growth, the East Asia and Pacific region remains one of the fastest-growing and most dynamic in the world. Sustaining high growth in the medium term will require reforms to enhance industrial competitiveness, diversify trading partners, and unlock the productivity potential of the services sector. However, geopolitical tensions and natural disasters pose downside risks to the outlook.

—

#WorldBank #GrowthEstimates #EastAsia #Pacific #China #EconomicOutlook #PropertyCrisis #GDPGrowth #FinancialConditions