Banca March: The World Bank has updated its economic forecasts for East Asia and the Pacific in its October report. Although the regions in question have shown a recovery from pandemic levels, the association warns of slow development. While the outlook for China’s output rates in 2023 is maintained (5.1%), those for next year 2024 are down from April’s estimates (4.8% to 4.4%). Likewise, the contagion effect of the Chinese economy reduces growth expectations for the Asia-Pacific bloc (excluding China) from 4.9% to 4.7% for 2024. Among the causes responsible for this lethargy, the World Bank lists structural factors such as high debt. In this sense, non-financial corporate indebtedness has increased considerably, especially in China and Vietnam, by more than 40 p.p., reaching values of up to 160% and 100% of GDP, respectively. As a result, the figures are higher than those of developed countries, thus damaging private investments that restrict resources for the implementation of new projects.
World Bank downgrades East Asian growth forecasts due to contagion effect from China’s slumping growth forecasts
