Beijing: China's economy has enjoyed a double-digit growth rate for over a decade now, but it is likely to slump below 9 percent this year amid the global economic slowdown, according to a forecast by JPMorgan.
Growth of the world's second-largest economy this year is likely to be lower than the previous estimate of 9 percent and may moderate further to 8.5 percent in 2012, JPMorgan's Managing Director and Chairman of Global Markets for China, Jing Ulrich, said.
The investment bank revised its forecast for China, the world's largest exporter, downward due to faltering growth in the United States, the European Union and Japan, China's top three trading partners, who together absorbed almost half of the country's exports, Ulrich is quoted saying.
The US economy may grow at 1 percent this year, while expansion in the euro zone is likely to be around 1-1.2 percent, JPMorgan projected.
A slowdown in net exports, one of the three pillars of China's economy along with investment and consumption, had a negative 0.43 percentage point impact on the country's gross domestic product growth in the first quarter and a minus 0.1 percentage point impact in the second quarter, versus a record high of 18.1 percent in 2007, Ulrich said.
China has announced a shift in its economic paradigm with effect from this year to reduce reliance on falling exports and increase domestic consumption.