As trade tensions and unstable capital flows affect the global economic outlook, the World Bank has slightly downgraded its economic growth forecast for East Asia and the Pacific for next year.
In a report Thursday, the Washington-based World Bank said developing economies in the region should make "full" use of existing macroeconomic policies to mitigate the impact of external shocks.
Developing economies in East Asia and the Pacific (EAP), including China, are expected to grow 6.3% this year from 6.6% last year and 6.0% in 2019, the World Bank said in its economic update report.
The economic growth forecast for 2019 is lower than the World Bank's April forecast of 6.1%, reflecting the slowdown in China's economy. China continues to adjust its economy from relying on investment to focusing on domestic consumption.
The World Bank said it expects China's economic growth to slow to 6.5% this year, flat from earlier estimates, and further slowdown to 6.2% next year, previously forecast at 6.3%.
"The main risks to sustain strong growth include the escalation of trade protectionism, the intensification of financial market turmoil and the interaction of China's domestic fiscal and financial vulnerabilities." Sudhir Shetty, chief economist of the East Asia and Pacific region of the world bank, said.
"In the context of rising risk, developing EAP economies need to use all available macroeconomic, prudent structural policies to calm external shocks and increase potential economic growth rates." He said in a statement.
Hot Model No.: