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World Bank expects China to grow slower
By Wang Yanlin |
June 13, 2013, Thursday
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Online Edition
Online Edition
THE World Bank cut its China's 2013 growth forecast to 7.7 percent today, compared with the previous projection of 8.3 percent in April as Chinese policymakers are "busy rebalancing the growth model."
It was the second cut since December last year when the bank expected China to grow 8.4 percent in 2013.
"The main risk related to China remains the possibility that high investment rates prove unsustainable, provoking a disorderly unwinding and sharp economic slowdown," the bank said in its Global Economic Prospects released today.
"Should investments prove unprofitable, the servicing of the existing loans could become problematic -- potentially sparking a sharp uptick in non-performing loans that could require state intervention," the bank said.
It expected growth of East Asia and the Pacific would slow to 7.3 percent this year, largely due to weaker performance in China as the country started to reduce its reliance on net exports and investment.
In the previous report in April, the bank said China should address challenges related to the property sector, the financial system and local government liabilities to avoid a sharp slowdown.
Globally, the bank downgraded its economic projection for this year to 2.2 percent from 2.4 percent, citing subdued growth in high-income countries, especially in Europe, despite their improvements in financial conditions.
It was the second cut since December last year when the bank expected China to grow 8.4 percent in 2013.
"The main risk related to China remains the possibility that high investment rates prove unsustainable, provoking a disorderly unwinding and sharp economic slowdown," the bank said in its Global Economic Prospects released today.
"Should investments prove unprofitable, the servicing of the existing loans could become problematic -- potentially sparking a sharp uptick in non-performing loans that could require state intervention," the bank said.
It expected growth of East Asia and the Pacific would slow to 7.3 percent this year, largely due to weaker performance in China as the country started to reduce its reliance on net exports and investment.
In the previous report in April, the bank said China should address challenges related to the property sector, the financial system and local government liabilities to avoid a sharp slowdown.
Globally, the bank downgraded its economic projection for this year to 2.2 percent from 2.4 percent, citing subdued growth in high-income countries, especially in Europe, despite their improvements in financial conditions.
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