BOFIT Viikkokatsaus / BOFIT Weekly 2019/30

Major institutional forecasts are largely in agreement that China’s economy will grow by 6.2–6.4 % this year. China’s official figures show GDP grew by 6.3 % in the first half. Most forecasters base their forecasts on China’s official figures, and thus also the global growth outlooks reflect China’s reported development. Some alternative estimates indicate China’s actual growth likely being somewhat lower than official figures (BOFIT Weekly 29/2019).

The updated IMF July forecast cuts China’s economic growth this year from the 6.3 % April number to 6.2 %, while the global 2019 growth reading ticks down from April’s 3.3 % to 3.2 %. The forecasted development would mean that China would still account for well over a third of all global growth (with purchasing power parity weights). The recently updated outlooks see China’s slowdown in growth be a bit faster than earlier expected due to uncertainty caused by the trade war with the US and lower growth of the global economy. The baseline scenarios of the IMF and World Bank both assume that trade tensions between the US and China will not escalate further, but the imposed punitive and retaliatory tariffs will remain in place. 

GDP growth forecasts for China, 2019–2021 (%)