The World Bank has delivered a dose of optimism for Chinese exports and the broader regional outlook. It raised its 2025 growth forecast for China to 4.8%, a number likely to be touted in investor circles. Expectations for 2026 have inched up as well, with growth now projected at 4.2%, up from the previous 4.0%. Still, any celebrations may be premature: the World Bank cautions that growth momentum is poised to lose steam next year.
The reasons are not hard to spot. Exports appear to be taking a breather, budget and debt challenges are prompting tighter fiscal stimulus, and the slowdown itself has become so entrenched that it is now a feature of the country’s development strategy.
Growth prospects have also brightened across East Asia and the Pacific. The region is expected to experience a 4.4% expansion this year. Forecasts for 2026, however, remain unchanged as policymakers adopt a wait-and-see approach amid lingering uncertainties.
Still, the World Bank notes that weak consumer and business confidence, coupled with sluggish export orders, continue to weigh on the region’s prospects. With these headwinds persisting, the overall growth outlook remains uncertain.
