The World Bank has revised its growth expectations for the Chinese economy upward for 2024 and 2025. In its latest report on China’s economic outlook, the Bank increased its growth forecast for 2024 to 4.9% and for 2025 to 4.5%. This represents an increase of 0.1 and 0.4 percentage points, respectively, compared to previous projections.
The report highlights that China's growth remained strong at 4.8% during the first three quarters of 2023, but slowed from the second quarter of 2024 onwards due to weak domestic demand and a downturn in the real estate sector. It also notes that the Chinese government has provided short-term stimulus measures to support domestic demand, while recommending structural reforms aimed at maintaining long-term financial stability.
However, the report also emphasizes structural constraints on growth. These include factors such as low consumption, high debt levels, and an aging population. Additionally, it points out that adverse developments in the real estate sector could weaken local government revenues and investments, while the weakening labor market may further restrict consumption.
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