ADB predicts China's economy to grow 6.6% in 2018

Beijing, April 11 (IANS) China's economic growth is expected to reach 6.6 per cent this year, the Asian Development Bank (ADB) said in a report released on Wednesday.

In its annual publication Asian Development Outlook (ADO) 2018, the Manila-based bank said China's growth accelerated on strong demand from home and abroad, Xinhua news agency reported.

"Expansion in China should moderate to 6.6 per cent in 2018 and 6.4 per cent in 2019 as economic policy leans further toward financial stability and a more sustainable growth trajectory," the ADB said.

According to the Chinese government work report released in March, China has set its GDP growth target at around 6.5 per cent for 2018.

The ADB said that service sector was fuelling China's continued growth, increasing by 8 per cent in 2017. Strong demand at home and abroad together with economic reforms lay the foundation for continued growth and macroeconomic stability in China, it added.

"Further progress on reforms such as strengthening financial sector regulation and supervision and addressing debt issues would lay a foundation for solid macroeconomic stability," the ADB said.

Meanwhile, the ADB said economic growth in East Asia picked up by 0.3 percentage points to 6.3 per cent in 2017 "as strong external and internal demand lifted every economy in the sub-region".

The ADB said other economies in the East Asian sub-region will see lower growth as well, mainly on account of moderating export growth.

"These developments will tamp down East Asian economic expansion to 6 percent in 2018 and 5.8 per cent in 2019," the ADB said.

It said inflation dipped in East Asia in 2017, reflecting moderation in China, where food prices fell. 

The ADB's economic publication outlook provides a comprehensive analysis of macroeconomic issues in developing Asia, including growth projections for 45 economies, including China, India and the Philippines.

The report also examines the prospects for developing Asia by sub-region: Central Asia, East Asia, South Asia, Southeast Asia and the Pacific.