BEIJING (AFP): The IMF on Tuesday lowered its forecast for Chinese economic growth this year to 4.4 per cent, despite reduced US tariffs and stimulus measures aimed at mitigating the impact of the Middle East conflict.
The new projection, published in the International Monetary Fund's latest World Economic Outlook report, is slightly lower than its January forecast of 4.5 per cent and well off last year's official five per cent expansion.
The Washington-based organisation said "lower US effective tariff rates on Chinese goods, and stimulus measures offset the negative impact of the shock induced by the Middle East conflict" on the world's second-largest economy.
Exports, the engine of China's growth, remained robust, it said.
But the country's overall economic outlook remains bleak, with growth expected to slow to 4.0 per cent in 2027 owing to "structural headwinds", the Fund said.
It cited "a grinding slowdown in the housing sector, a declining labour force, decreasing returns on investment, and slower productivity growth".
The IMF also cut its 2026 growth forecast for emerging and developing Asia to 4.9 per cent from 5.0 per cent -- a significant slowdown from the region's 5.5 per cent expansion recorded last year.
"In several South and Southeast Asian economies, disruptions in the Middle East are expected to reduce tourism and remittance inflows, thereby weakening domestic demand," the Fund said.
Among those being hit was the Philippines, with the IMF cutting its outlook for growth by 1.5 percentage points as war shocks compound the negative effects of a weaker-than-expected 2025 result.
But India's economy is now tipped to grow 6.5 per cent this year, a rise of 0.1 percentage point from the previous forecast, with the Fund saying the reduction in US tariffs -- from 50 per cent to 10 per cent -- will soften the impact of the Middle East conflict.
Reflecting the worldwide disruption of energy supplies caused by the war in the Middle East, global economic growth for 2026 was revised downwards by 0.2 points to 3.1 per cent. - AFP
