East Asia and the Pacific will see its growth slow in the coming years (World Bank)

2023-10-02 18:05:00

The engine of global growth risks coughing in the coming years. According to the World Bank (WB) during the publication of its half-yearly forecasts, East Asia and the Pacific will experience sustained growth this year at 5% in 2023, with a slowdown observed in the second half, then return to 4.5% in 2024, observes the World Bank which points to the effect of the slowdown in China next year.

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Despite very largely positive growth, these figures, if confirmed in fact, appear to be the lowest since the end of the 1960s, excluding periods of crisis such as the pandemic, the Asian financial crisis at the end of the 1990s and the oil crisis in the 1970s.

For the year 2023, China is expected to drive the region’s momentum, with expected growth of 5.1% while other countries should see their cumulative growth approach 4.6%. But for 2024, “ Improving external conditions will support growth for the rest of the region while China faces persistent domestic challenges », Worries the World Bank in its press release.

Strong dependence on exports

In East Asia and the Pacific, the institution is particularly concerned regarding the high level of debt, the weakness of the real estate sector and even structural problems, such as the aging of the population. As a result, the Bank is lowering its growth forecast to 4.5% for 2024 in the region, while it was still expecting 4.8% last April.

« The region remains one of the most dynamic in the world, even with more moderate growth. In the medium term, maintaining high growth will require reforms to maintain industrial competitiveness », Pointed out the vice-president of the World Bank for the region Manuela Ferro.

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The subject for these countries, which are still very competitive, remains the dependence on exports to compensate for weak domestic demand. The World Bank suggests the development of services as growth drivers for these economies still centered on industrial production, and the development of digital technologies.