The remit of The World Bank is to work towards the ending of poverty; it is the largest anti-poverty institution in the world. It provides, loans, advice, knowledge and a range of tailored resources to more than 100 least developed nations and nations in transition. It also makes economic forecasts which are designed to provide a degree of forward guidance to interested parties.
The World Bank has revised its growth forecast for the world’s second largest economy, China, downwards. It anticipates that China’s economic growth will slow over the next three years as the nation deals with structural reforms, but the projected pace of growth is still breath-taking in comparison to China’s major competitors. The World Bank suggests that growth will come in at 7.6% down from a previous estimate of 7.6% this year. The Bank anticipates that Chinese growth will decline to 7.2% next year and to 7.1% in 2016. The Bank had anticipated growth of 7.5% in both 2015 and 2016. It is also projecting that regional growth in East Asia will miss forecasts, trimming it from 7.1% to 6.9% for the next 24 months, largely because of continuing weakness in global trade.
The Chinese state aims to secure growth of 7.5%, but analysts do not believe that China will engage in fresh stimulus measures (at this stage anyhow) to make up for the projected shortfall. The World Bank believes that growth in the Chinese economy will ease as authorities try to compromise between containing risks associated with growth and approaching growth targets. "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 World Bank commented.
Global demand remains weak and consequently, demand for Chinese goods is under pressure. China represents an enormous and largely untapped domestic market which global economic powers are keen to access. China itself needs to redress the balance between domestic and external demand, but this requires a greater redistribution of wealth than has yet be seen within the communist state.