BANGKOK (AP) — The World Bank trimmed this year's growth forecast for developing East Asian economies on Monday and urged governments to improve conditions for investment and exports.
Economies in the region that includes China and Southeast Asia should grow by 6.9 percent, the Washington-based bank said. That was down from a forecast of 7.1 percent in April but still gives the region the world's fastest growth.
Growth, with the exception of China, should pick up next year as developed economies recover and demand for exports increases, the bank said.
China, the region's biggest economy, is expected to grow by 7.4 percent this year, easing to 7.2 percent in 2015, the bank said in its East Asia Pacific Economic Update.
The region "will continue to have the potential to grow at a higher rate — and faster than other developing regions — if policy makers implement an ambitious domestic reform agenda," said the bank's vice president for the region, Axel van Trotsenburg, in a statement.
Such reforms include removing barriers to domestic investment and improving export competitiveness, van Trotsenburg said.
China, Vietnam, Malaysia and Cambodia are "well positioned" to increase exports, the bank said.
Malaysia is forecast to grow by 5.7 percent, up from a forecast of 4.9 percent in April, the report said. It said Indonesia's growth will decline to 5.2 percent from last year's 5.8 percent due to lower commodity prices and smaller government consumption.
The bank warned the region is vulnerable to a sharp slowdown in China, where leaders are trying to boost domestic consumption and reduce reliance on trade and investment.
China is a major consumer of raw materials from its neighbors and a slowdown could hurt commodity producers such as metal exporters in Mongolia and coal exporters in Indonesia.
World Bank: www.worldbank.org