(MENAFN) The World Bank (WB) lowered the economic growth outlook for the East Asia and Pacific region, and warned that a further slowdown in China could worsen and last longer than many analysts have forecasted, Reuters reported.
East Asia is set to grow by 7.2 percent this year and 7.6 percent in 2013, down from earlier estimates of 7.6 percent and 8.0 percent, respectively, the World Bank said.
Bert Hofman, WB Chief Economist for East Asia and the Pacific said that China's economic slowdown is driven by weaker exports as well as domestic demand, in particular investment growth.
He stressed that China could experience a soft landing as expected in WB's revised 7.7 percent growth forecast for this year and 8.1 percent for next year.
The World Bank also said in its report that investment plans that several local governments in China pledged might see funding constraints.
The report also expected the central government to do nothing to stimulate the slowing economy, as policymakers were concerned that home prices could rise again and a possible reversal of hot money flows.
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