World Bank Asks China to Cut 2015 Growth Forecast to 7%

October 29, 2014 Share Print 0

China can cut its economic growth target to 7 percent next year without hurting its labor market, the World Bank said on Wednesday even as it urged Beijing to get rid of rigid growth objectives.

At its thrice-yearly review of the Chinese economy, the World Bank warned China against carrying its “ambitious” 2014 economic growth target of 7.5 percent into next year, saying that such a move would detract from the government’s reform plans.

After 30 years of breakneck, double-digit economic expansion that lifted millions of Chinese from abject poverty but also polluted the nation’s air, land and waterways, China wants to retool its economy to generate slower but better-quality growth.

But the quest to let market forces supplant state planning in running the world’s second-biggest economy would require China to live with less frenzied economic growth rates and income rises, a point stressed by the World Bank.

“Our policy message is the focus should be on reforms rather than meeting specific growth targets,” Karlis Smits, a senior economist at the World Bank office in Beijing, told reporters at a media briefing.

via Reuters

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Bio
Twitter
Google+
Latest Posts

Alfonso Esparza

Senior Currency Analyst at Market Pulse

Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.