World Bank Cuts 2013 Growth Forecast for East Asia
The World Bank lowered its projection of the growth rates in 2013 for East Asia—down from 7.8% forecasted in the spring to 7.1%. This was due to slower growth in China and other countries in the region. The growth rate for China in 2013 was down from 8.3% projected in the spring to 7.5%. This comes at a time when China is putting more emphasis on domestic demand and trying to rely less on export. Other countries in the region, which are expected to grow 5.2% in 2013, suffered from lower investment and weaker export. The situation, however, is improving, with recent Chinese government’s stimulus policies and stronger growth in the U.S. and Europe, which boosted export from East Asia. The World Bank urged Asian economies to take more measures to reduce future risks in the market, including reducing foreign debt and depreciating local currencies when needed. The decision made by the U.S. Federal Reserve to delay withdraw of its stimulus program helped to stabilize the world market and provided the East Asia with more time to prepare for future challenges, according to the World Bank.