BOFIT Viikkokatsaus / BOFIT Weekly Review 2016/03
As fears about a possible “hard landing” of the Chinese economy rise, a number of forecasters have tried to estimate the effects of such a slowdown on the rest of the world. Most expect the hardest hit countries to be China’s neighbours, who constitute important export markets. Commodity-producing countries would also suffer from further weakness in demand and lower prices. The World Bank forecast suggests that a one percentage point slowdown in Chinese economic growth cuts one percentage point off GDP growth in Hong Kong and Singapore over the next two years and about 0.4 percentage point off growth in Indonesia, Malaysia and Thailand. UBS Bank calculates that a slowdown in China’s growth this year to 4 % would drive many countries in Eastern and Southeast Asia into recession.
Economic growth forecasts for China, %