ADB keeps China's 2017 growth forecast at 6.7%

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China's growth is projected to be 6.7 percent this year and 6.4 percent for 2018, said the Asian Development Bank (ADB) on Tuesday, sticking with its July estimates.

This is due to better-than-expected external demand, proactive fiscal policy and strong domestic consumption combining to drive up China's growth, ADB's flagship annual economic publication, the Asian Development Outlook (ADO) points out.

"The Chinese economy remains resilient, solidifying its role as an engine of global growth," said Yasuyuki Sawada, ADB Chief Economist, in a statement following the update.

Noting that China's supply-side reform is progressing, Sawada said eventual success hinges on a careful balancing of the roles of the market and the state, particularly as the country continues its transition to a more market- and services-driven economy.

China's economy expanded 6.9 percent for the first half of 2017, with consumption and services, together with new innovation-driven economic sectors, taking up larger roles in the economy.

For the rest of 2017, the ADB forecasts that consumption will remain the main growth driver of the economy as incomes rise and consumer confidence strengthens.

Net exports, which have contributed to China's growth so far, will not play the same role in 2018 when imports are again expected to exceed exports. Investment, meanwhile, will continue their downward trend due to structural and cyclical factors, including an uncertain business outlook for export oriented industries and remaining industrial excess capacity, according to the update.

Source(s): Xinhua News Agency