World Bank cuts growth forecast for Asia-Pacific, China GDP to gain 7.7%

The World Bank cut some of its growth forecasts for Asia yesterday on the back of weakening economic growth prospects in China and uncertainties brought about by turmoil in Europe.

The bank trimmed this year's growth outlook for developing economies in the Asia-Pacific to 7.2 per cent, down 0.4 percentage point from its forecast in May.

For China, the world's second-largest economy, the bank pared its growth forecast to 7.7 per cent from 8.2 per cent. The mainland's economy grew 9.3 per cent last year.

In its report, the bank warned that China's cooling economy faced the risk of a "more pronounced slowdown". The "slowdown this year has been significant, and some fear it could still accelerate", the bank said.

China's economic growth slowed owing to weakening domestic demand and investment growth after authorities clamped down on the property sector. Private investment growth fell the most, while state-owned enterprises' investment started to accelerate again from the end of last year, the bank said.

In contrast, consumption was still growing robustly, spurred by wage increases, adjusted for inflation, notably for migrant workers, the report said.