The World Bank cut its growth forecast for East Asia and the Pacific for 2022 — which includes growth engine China — to reflect the economic pinch of Russia’s invasion of Ukraine.
The Washington-based lender said in a report early Tuesday Asian time that it expected 2022 growth in the region to expand 5.0% percent, lower than its 5.4% forecast issued in October.
China’s economy is expected to grow 5.0% this year, down from a previous estimate of 5.4%, the World Bank said in its Spring 2022 East Asia and Pacific Economic Update.
The updated outlook reflects a hit to the region from Russia’s invasion of Ukraine, especially for countries that import energy products. Also factoring in the lowered outlook: rising U.S. interest rates and slowing growth in China. Plus, ongoing supply chain shocks are still hurting manufacturers and pushing up prices, the World Bank said.
“Just as the economies of East Asia and the Pacific were recovering from the pandemic-induced shock, the war in Ukraine
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is weighing on growth momentum,” said World Bank Vice President for East Asia and Pacific Manuela Ferro.
“The region’s largely strong fundamentals and sound policies should help it weather these storms,” Ferro said.
