World Bank: China's economic growth slowest since 1960s

2023-10-03 22:43:41, Kosova & Bota CNA

Hours after the People's Republic of China celebrated its 74th birthday on October 1, the World Bank lowered its economic growth forecast for the country next year.

The World Bank said in its semi-annual regional forecast, released on Sunday, that it expects China's economic output to grow by 4.4% during 2024, up from 4.8% expected in April. The bank emphasized the weaknesses that the Chinese property sector is experiencing.

The bank also warned that the emerging economies of East Asia, including China, will expand at one of the slowest rates "since the late 1960s", barring exceptional events such as the COVID-19 pandemic, the Asian financial crisis at the end of 1990s and the global oil economic turmoil of the 1970s.

The bank cut its 2024 forecast for gross domestic product (GDP) growth for emerging economies in East Asia and the Pacific, including China, to 4.5%, from the 5% rate expected this year.

For 2024, the bank cut regional forecasts to 4.5% growth from 4.8%, citing external factors including a sluggish global economy, high interest rates and trade protectionism.

Manuela Ferro, the World Bank's vice president for East Asia and the Pacific at the World Bank, was quoted by financial media outlet Investopedia as saying that the region has one of the "fastest and most dynamic growth in the world, even if growth is moderate." .

She said maintaining high growth over the medium term will require reforms to "maintain industrial competitiveness, diversify trading partners and unlock the potential of productivity growth and job creation in the services sector".

Ahead of China's "National Day" on October 1, President Xi Jinping gave a speech acknowledging that China's road ahead will not be smooth.

"Our future is bright, but the road ahead will not be easy," Mr Xi told his 800 or so guests, some of whom were foreign diplomats.

At the Sept. 28 reception, Mr. Xi told attendees that China must continue to overcome "obstacles" and that "the country's strength comes from unity, and trust is more valuable than gold."

Mr. Tseng Chien-yuan, with the New School for Democracy, a Taiwanese organization that supports human rights activists, told VOA in Mandarin that Mr. Xi's speech shows that China faces challenges that include a sluggish economy that continues to recover from Beijing's strict "zero-COVID" policy while grappling with global economic uncertainties caused by Russian aggression in Ukraine.

Mr. Tseng said that, "Leader Xi Jinping's remarks make people feel that [he] is a little uneasy about the future, [but] he is also becoming increasingly aware that the international situation facing China is caused from his excessive political moves that led him to a dilemma.”

Pressure from the property sector also appears to be weighing on China's economy. On the day of Mr. Xi's speech, Chinese real estate giant Evergrande Group announced that Mr. Hui Ka Yan, chairman of the company's board of directors, had been arrested on suspicion of committing unspecified crimes. The share prices of many of Evergrande's subsidiaries fell./ VOA