The International Monetary Fund has significantly downgraded its growth forecast for Hong Kong this year amid a slowing global economy. The IMF, due to report on world growth forecasts this week, has dropped its gross domestic product outlook for the SAR from 4.8 per cent to 3.5 per cent, according to information leaked to Reuters. China's outlook has been little affected by the global slowdown with an expected forecast of between 7 per cent and 7.5 per cent growth in the bi-annual World Economic Outlook report. Hong Kong IMF resident representative William Lee told the South China Morning Post yesterday he could confirm the IMF would announce the downgrade this week. Mr Lee could not confirm the number but said it was in the range of the reported 3.5 per cent. He said the IMF report would show Hong Kong was better positioned than most other Asian economies to weather the global storm. 'I think it is pretty 'plain vanilla'. Almost everything I know about [in the report] is already out there,' he said. The downgrade for Hong Kong and other Asian and global economies stems from a lightning-speed slide in the US after a decade of robust growth. As the US slows, so does export-reliant Asia, particularly as many regional economies are still implementing fiscal and banking reforms put in place after the 1997-98 Asian financial crisis. Fears of a US recessionary period - coupled with a weakening Japanese yen - have lead to a growing number of downgrade calls in recent weeks from regional investment banks. In its Asia Recovery Report 2001 released last month, the Asia Development Bank scaled down growth forecasts for five Asian economies by an average of more than three percentage points compared with forecasts 12 months ago. Last week Macquarie Bank in Hong Kong said it expected weighted average growth of 5.7 per cent for Asia, other than Japan, this year, with China estimated to contribute more than half. HSBC last month announced a dip in growth estimates for Hong Kong this year - from 3.4 per cent to 2.2 per cent. ABN Amro suggested a 1.5 per cent real GDP full-year growth rate for the SAR. In the case of the US, former IMF Asia director Hubert Neiss - now with Deutsche Bank Asia-Pacific - said at a conference in Hong Kong yesterday he expected 'slightly negative' growth in the second quarter. Yesterday, the Hong Kong General Chamber of Commerce said it would keep this year's growth forecast for the SAR at 4.8 per cent for now. However outgoing chairman Tung Chee-chen said that if he were to revise the figure it would be on the downside.