The growth of the Chinese economy in 2009 is expected to be only 7.5 percent, the lowest rate in 19 years, due to the drying up of global market appetite for the once unstoppable export machine of the country, warned the World Bank on Tuesday in its latest quarterly report on the state of the Chinese economy.
This is lower than the previously forecasted 9.2 percent and is also the fourth lowest growth rate that the country could record since it launched reforms three decades ago. The Chinese economy last recorded a similar slowdown, at just 3.8 percent, in 1990, due to the isolation of the international community following the Tiananmen Square massacre the previous year. "Forecasts for the global economy are significantly weaker than they were six months ago," emphasizes Louis Kujis, senior economist at the World Bank. "Moreover, there has been an intensified slowdown in the domestic Chinese market, primarily influenced by weakness in the real estate sector," he adds.
In 2008, the growth of the Chinese economy was expected to be 9.4 percent, further highlights the World Bank in its recently published report. For comparison, in the previous quarterly review, it forecasted a growth of 9.8 percent for this year. This will also be the first decline in the rate of Chinese economic growth below double digits since 2002, and its value will be significantly lower than last year’s 11.9 percent. China is already recording a decline in its trade surplus in 2008, while 2009, as estimated by the WB, could still be somewhat better. Total imports of all economies in the world will weaken next year for the first time since 1982, further warns the WB. "There will be a coordinated recession in the US, Japan, and Europe, which creates quite a difficult environment for developing countries," stated David Dollar, the World Bank’s director for China.
