In a recent update, the World Bank (WB) revised down its projections for China’s economic growth in 2023. Growth is now estimated at 5.2 %, marking an adjustment with respect to the previous forecast of 5.6 % made last June.

The Washington-based institution also revised up its forecasts for 2024, raising China’s Gross Domestic Product (GDP) growth from 4.4 % to 4.5 %, indicating an optimistic outlook for next year.

The report highlights the prospect of a protracted recovery in the housing sector and persistently weak external demand. The government is expected to maintain a moderately expansionary fiscal and monetary stance in 2024 to support growth.

The World Bank points to “structural constraints” to growth, including “high debt levels“, “ageing populations”, and “lower productivity growth.” It also identifies “significant risks”, such as a possible prolonged slowdown in the real estate sector, increased geoeconomic tensions and the impact of climate change.

Mara Warwick, World Bank Director for China, Mongolia and Korea, stressed that the easing of macroeconomic policy has supported the short-term recovery, but stressed the importance of

Complementary structural reforms to boost confidence and revive the momentum for growth. Improving China’s debt resolution framework and strengthening the enabling environment for private business are crucial, Warwick said.

During the third quarter, the world’s second-largest economy recorded an increase of 4.9% compared to the same period of 2022, still marked by the aftermath of the already dismantled national policy of ‘zero Covid’.

Beijing had set an official growth target of “around 5 %” for this year. Amid threats such as the housing crisis, local government debt risks, slow global growth, and geopolitical tensions, Chinese authorities have sought to counteract the weak post-pandemic economic recovery in recent months.

K. Tovar

Source: Bancaynegocios

(Reference image source: Alexander Grey, Unsplash)

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The Russian Government estimates that its economy will register a contraction of less than 3% during 2022, while the fall for next year will be less than 1%, according to the latest perspectives released by the country’s deputy prime minister, Andrey Belousov this Monday in the Executive commission in charge of the country’s economy.

The deputy prime minister has indicated that these figures are better than expected and create “good conditions” for the real income of citizens and the tax revenue of the State to grow.

The figures are better than expected despite the context of the war with Ukraine and the sanctions applied by a large part of the developed countries against Moscow. At the end of July, the International Monetary Fund estimated a 6% drop in Russia’s gross domestic product (GDP) this year, while in 2023 the decline would be 3.5%.

In its latest monthly report, released earlier this month, the International Energy Agency explained that through July, Russian crude production had only fallen by 310,000 barrels per day compared to pre-war levels. The country’s production is over 11 million barrels per day.

The Russian economy experienced a year-on-year growth of 3.5% in the first quarter of this year, while in the second quarter it registered a contraction of 4%, according to the latest data released by the Russian statistical agency, Rosstat.

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Source: dpa

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The euro zone economy will grow this year at a rate of 4 %, one tenth more than expected last December, although in 2020 the rebound will be 4.1 % instead of the 4.2 % previously estimated. Meanwhile, the bloc’s inflation rate will accelerate as a consequence of “temporary” factors this year and the next, according to Christine Lagarde, president of the European Central Bank (ECB).

Specifically, the central bank expects that the inflation rate in the euro area will stand at 1.5 % in 2021, compared to the 1 % forecast last December, while a year later prices will rise by 1.2 %, one tenth more than previously expected.

Looking ahead to 2023, the ECB’s macroeconomic projections remain unchanged from the forecasts announced in December 2020, with growth in Gross Domestic Product (GDP) of 2.1 % and an inflation rate of 1.4 %.

“While the overall economic situation is expected to improve throughout 2021, uncertainty persists around the short-term economic outlook, related in particular to the dynamics of the pandemic and the speed of vaccination campaigns,” said Lagarde at a press conference.

Thus, while, on the one hand, the better prospects for global demand, driven by significant fiscal stimulus, and progress in vaccination campaigns are encouraging, on the other hand, the ongoing pandemic, including the spread of Mutations of the virus, and their implications for economic and financial conditions remain sources of downside risk.

K. Tovar

Source: dpa

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