By Beth Main.
Image credit: @beardnan.
The World Bank raised its economic growth predictions for East Asia on Wednesday, placing China’s forecast growth at 8.4 percent in 2013, suggesting that Asia will remain largely unaffected by the global economic slump. However, as anyone paying attention to Chinese economic forecasts knows, it’s easy to find different opinions.
“For 2013, we expect the region to benefit from continued strong domestic demand and a mild global recovery that would nudge the contribution of net exports to growth back into positive territory, a trend projected to continue into 2014,” the World Bank said in its latest East Asia and Pacific Economic Update.
“Most countries in the region have retained their strong macroeconomic fundamentals and should be able to withstand external shocks,” it added, although it warned of risks such as a sharp drop in investment growth in China that could shake global confidence and a U.S. failure to reach an agreement on tax increases and spending cuts before the end of the year.
Recent policies to boost China’s economy include two interest rate cuts since June, and the approval of infrastructure projects worth more than $150bn.
The rest of the region, including Thailand, Philippines, Indonesia and Burma, is now projected to grow 5.7 percent in 2013, up from the previous forecast of 5.5 percent, with the Philippines doing particularly well with a predicted growth of 6.2 percent for 2013, up from 5%.
These positive predictions are set to continue well into 2014.