World Bank cuts East Asia’s 2022 GDP growth forecast to 5% on Ukraine crisis

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The World Bank cut its growth forecast for East Asia and the Pacific for 2022 to reflect the economic impact of Russia-Ukraine conflict, warning the region could lose further momentum if conditions worsen.

The Washington-based lender said in a report on Tuesday it expected 2022 growth in the developing East Asia and Pacific region to expand 5 percent, lower than its 5.4-percent forecast in October.

But growth could slow to 4 percent if conditions worsened and government policy responses were weaker, the Bank said.

China’s economy is expected to grow 5 percent this year, down from a previous estimate of 5.4 percent, it said. The expectation is lower than the government’s goal of around 5.5 percent.

“The region confronts a triad of shocks which threaten to undermine its growth momentum,” said World Bank East Asia and Pacific Chief Economist Aaditya Mattoo.

The tension between Russia and Ukraine, which Mattoo said was the “most serious risk” to the region’s growth outlook, is leading to food and fuel price increases, financial volatility and reduced confidence all over the world.

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