Economic news

World Bank lifts China’s growth prediction for 2017

Today the World Bank lifted its prediction of China’s economic rise this year from previous estimate of 6.7% to 6.8%, citing private consumption and exports catalyzing growth.

However, the financial institution left predictions for China’s GDP for the next two years the same – 6.4% for 2018 and 6.3% for 2019, because of monetary policy and attempts to restrain credit.

Regardless of the deceleration a while ago, credit keeps expanding quite intensely, overtaking the pace of GDP, according to the World Bank. Outstanding loans made up 150% of GDP last month, whereas in late 2007 their volume had been 103%, the Bank reported as well.

The economy of China expanded at a pace surpassing expectations, reaching 6.9% in the January – September period of this year, though the government’s actions aiming to lower risks in the sector of finance have sent up borrowing costs, causing worries that GDP could grow less forcefully.

Robust expansion in 2017 helped the government to speed up deleveraging, which would probably be pulling down GDP growth in the short-term though long-term outlook for China would solidify, said the World Bank. Outside risks for the country’s economy could be the possibility for stricter trade rules in developed countries, and geopolitical issues, it also said.

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