World Bank says China's growth to slow down to 7.4 pc

China may miss the official target of 7.5 per cent GDP growth rate as the World Bank today cut the forecast for the world's second largest economy to 7.4 per cent this year, predicting its continued slow down.
China's growth will ease to 7.4 per cent this year and 7.2 per cent in 2015, as the government seeks to put the economy on a more sustainable path with policies addressing financial vulnerabilities and structural constraints, the World Bank said in its report released in Singapore today.
The figure is notch lower than the official target of 7.5 per cent, which the Chinese government set for this year as a threshold to halt the continued slow down of the economy hit by declining export markets and slow increase of domestic consumption.

China registered 7.7 per cent GDP last year.
The slowdown from heydays of double-digit GDP growth till 2010 was attributed to China continuing with the structural reforms to address financial vulnerabilities and structural constraints.
"Measures to contain local government debt, curb shadow banking, and tackle excess capacity, high energy demand, and high pollution will reduce investment and manufacturing output," the state-run Xinhua news agency quoted the World Bank's report.

"China's slowdown in economy would be gradual; it is not the bottom falling out of China's growth," said Sudhir Shetty, World Bank's Chief Economist in East Asia and Pacific Region, adding, the slowdown in economic growth of China will not have a dramatic impact on other countries.

However, the report pointed out that if China experiences a sharp slowdown, which is unlikely, it would hit commodity producers in the region, such as metal exporters in Mongolia and coal exporters in Indonesia, especially hard.
Regarding China's outlook, the report said structural reforms in sectors such as state enterprises and services could help "offset the impact of measures to contain local government debt and curb shadow banking."
As to the property market, the bank said "a major nationwide correction in real estate prices in China remains unlikely, although there may be pressure on prices in several of the less rapidly growing provinces.