According to the World Bank, economic growth in East Asia and the Pacific will slow significantly in 2022 due to the slowdown in the Chinese economy, but will pick up more strongly in 2023.
According to the World Bank’s forecast, the economies of East Asia and the Pacific, which includes China, are expected to grow by 3.2% in 2022, down from the April forecast of 5%, and down from 7.2% a year earlier.
The main reason for the downward revision of the economic forecast for 2022 is the slowdown of the Chinese economy due to the implementation of a strict zero COVID policy, which affects the industrial sector.
Meanwhile, the Chinese economy is expected to grow by 2.8% this year, down from a previous forecast of 5%.
China accounts for 86% of economic output in the East Asia and Pacific region, which comprises 23 countries.
The report also said that aggressive interest rate hikes by central banks around the world to cope with rising inflation are another risk factor affecting economic growth prospects in East Asia and the Pacific. This is because such factors lead to capital outflows and demonetization.