World Bank raises China 2017 growth forecast, maintains 2018 outlook | The Daily Star
12:00 AM, December 20, 2017 / LAST MODIFIED: 12:00 AM, December 20, 2017

World Bank raises China 2017 growth forecast, maintains 2018 outlook

The World Bank on Tuesday raised its forecast for China's economic growth in 2017 to 6.8 percent from 6.7 percent it projected in October, as personal consumption and foreign trade supported growth.

But the Washington-based lender kept its forecast for China's 2018 and 2019 GDP growth unchanged at 6.4 percent and 6.3 percent, respectively, due to less accommodative monetary policy and the government's effort to rein in credit and control leverage.

The key downside risks to the forecast are the still rising leverage of the non-financial sector and uncertainty around housing prices.

“Despite the recent slowdown, credit continues to grow considerably faster than GDP. Outstanding bank loans reached 150 percent of GDP in November 2017, up from 103 percent at the end of 2007,” the World Bank said in its China Economic Update.

China's economy grew at a faster-than-expected 6.9 percent over the first nine months of the year, but Beijing's campaign to reduce risks in the financial sector has pushed up borrowing costs, raising concerns GDP growth could take a hit next year.

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