ASIATODAY.ID, JAKARTA – The World Bank projects economic growth in the East Asia and Pacific region to fall to 4.8 percent in 2024.
“Growth in East Asia and the Pacific is projected to fall to 4.8 percent this year, as the slowdown in China offsets faster growth in several other large countries,” was quoted as saying in a Wold Bank report entitled “Global Economic Prospects” received in Jakarta, Tuesday , June 11, 2024.
Growth in the Middle East region is expected to continue to slow, to 4.2 percent in 2025 and 4.1 percent in 2026, as growth in China continues to slow, outpacing increases in other countries in the region.
Compared with January projections, East Asia and Pacific growth is expected to be 0.3 percentage points higher in 2024 and 0.2 percentage points lower in 2025.
In China, growth is projected to slow to 4.8 percent in 2024, 0.3 percentage point higher than January forecast, primarily reflecting stronger-than-expected activity in early 2024, particularly exports.
Following strong expansion in 2023, consumption is expected to slow significantly in 2024 amid weakening consumer confidence.
Overall investment growth will remain weak, supported by government spending, but hampered by prolonged weakness in the property sector.
Real estate activity is not expected to stabilize until towards the end of the year, supported by measures to shore up the sector. Growth is projected to weaken further, to 4.1 percent in 2025, 0.2 percentage point lower than forecast in January mainly due to weaker investment prospects, and 4 percent in 2026, as potential growth is weighed down by slowing productivity, weakening investment , and increasing demographic barriers.
In the Asia Pacific region excluding China, following below average growth last year, activity is expected to increase by 4.6 percent in 2024. Growth will be supported by increased global goods trade which will benefit exports and industrial activity, offsetting the impact of weak growth in China.
The acceleration in activity is expected to reach record levels in some of the most export-oriented countries, including Thailand and Vietnam.
The global tourism recovery from this pandemic is almost complete, but continues in East Asia and the Pacific where the reopening of tourism has been delayed in several countries, especially in China. This will help increase service exports in several countries, including Cambodia and Thailand.
By 2025, growth is expected to accelerate to 4.7 percent, and then to 4.8 percent in 2026, as global trade firms and the region’s growth rates converge towards their potential.
Meanwhile, although risks to the regional outlook have become more balanced since January, they are still skewed to the downside.
Negative risks include escalating armed conflicts and escalating geopolitical tensions around the world, further fragmentation of trade policy, and weaker-than-expected Chinese growth, as well as adverse impacts to the broader region.
Worse-than-expected financial conditions and natural disasters, including more frequent extreme weather events due to climate change, especially tropical storms and destructive floods, could also result in slower-than-expected growth.
On the other hand, faster than expected growth in the United States (US) could have a positive impact on regional activity. (ATN)
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