The abrupt relaxation of strict COVID-19 containment measures and the ongoing weakness of the real estate market are to blame for the World Bank's reduction in China's growth outlook for this year and next.
In a report released on Tuesday, the Washington-based lender predicted that China's economy would expand 2.7% in 2022 before rebounding to 4.3% in 2023 as it reopened after the worst of the pandemic.
The bank's anticipated growth in 2022 would be considerably less than the official target of roughly 5.5%.
China's growth was predicted by the World Bank to be 2.8% this year and 4.5% the following year in September.
"China's growth outlook is subject to significant risks, stemming from the uncertain trajectory of the pandemic, of how policies evolve in response to the COVID-19 situation, and the behavioral responses of households and businesses," the bank said in its report.
"Persistent stress in the real estate sector could have wider macroeconomic and financial spillovers."
According to the lender, China also faces extremely uncertain global growth prospects and increased geopolitical tension.
A rise in COVID-19 infections at a time when the global economy is weakening is having a negative impact on exports. Last week, Chinese leaders promised to step up policy adjustment to support the slowing economy.
(Source:www.reuters.com)
In a report released on Tuesday, the Washington-based lender predicted that China's economy would expand 2.7% in 2022 before rebounding to 4.3% in 2023 as it reopened after the worst of the pandemic.
The bank's anticipated growth in 2022 would be considerably less than the official target of roughly 5.5%.
China's growth was predicted by the World Bank to be 2.8% this year and 4.5% the following year in September.
"China's growth outlook is subject to significant risks, stemming from the uncertain trajectory of the pandemic, of how policies evolve in response to the COVID-19 situation, and the behavioral responses of households and businesses," the bank said in its report.
"Persistent stress in the real estate sector could have wider macroeconomic and financial spillovers."
According to the lender, China also faces extremely uncertain global growth prospects and increased geopolitical tension.
A rise in COVID-19 infections at a time when the global economy is weakening is having a negative impact on exports. Last week, Chinese leaders promised to step up policy adjustment to support the slowing economy.
(Source:www.reuters.com)
