Coronavirus pandemic expected to slash China’s 2020 growth to 2.3 per cent, World Bank warns

East Asia will see a sharp drop in growth due to coronavirus, with China’s expansion slowing to 2.3 per cent this year in a best-case scenario, says World Bank

Severe economic contraction followed by a sluggish recovery could see 11 million people in the region could descend into poverty

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Economic activity in East Asia, including China, will be severely disrupted by the coronavirus pandemic this year, the World Bank says. Photo: AFP

Published: 12:51pm, 31 Mar 2020Updated: 9:04am, 6 Apr 2020

The coronavirus pandemic’s economic fallout could cause China’s growth to come to a standstill while driving 11 million more people in East Asia into poverty, the World Bank warned on Monday.

The pandemic is causing “an unprecedented global shock, which could bring growth to a halt and could increase poverty across the region,” said Aaditya Mattoo, World Bank chief economist for East Asia and the Pacific.

Even in the best-case scenario, the region will see a sharp drop in growth, with China’s expansion slowing to 2.3 per cent this year from 6.1 per cent in 2019, according to a report on the pandemic’s impact on the region.

Under the most pessimistic scenario, growth in China could tumble to be 0.1 per cent, the bank said.

With two-fifths of the world’s population under some form of lockdown that is caused the shuttering of businesses and a slowdown in transport to try to contain the virus, the country where the outbreak originated may escape a recession but will nonetheless suffer a sharp slowdown.

Just two months ago, the World Bank’s economists forecast China would grow by 5.9 per cent this year, which would have been its worst performance since 1990.