World Bank Elevates China's 2025 Growth Forecast to 4.8%, Cautions on 2026 Slowdown

World Bank Upgrades China's 2025 Economic Outlook

The World Bank has increased its 2025 GDP growth forecast for China to 4.8%, an upward revision from its previous projections. This updated outlook was released on Tuesday, October 7, 2025, as part of its biannual 'East Asia and Pacific Economic Update'. The institution attributed the upgrade to China's 'better-than-expected performance' this year, characterized by robust export activity and sustained manufacturing output.

The new forecast represents a significant adjustment from earlier predictions, which had placed China's 2025 growth at 4.0% in April and 4.5% in June. The World Bank also noted that the broader East Asia and Pacific region is expected to see increased growth, with its 2025 forecast lifted to 4.4%.

Anticipated Slowdown in 2026

Despite the positive revision for the near term, the World Bank issued a cautionary note regarding China's economic momentum for 2026. The institution projects a deceleration in growth, with the forecast for 2026 set at 4.2%, an increase from the 4.0% previously anticipated. This expected slowdown is attributed to several impending headwinds:

• Weakened export demand
• Low consumer and business confidence
• Reduced fiscal stimulus in light of rising public debt
• Ongoing structural economic challenges
• Property sector troubles
• Weak new export orders

The report authors stated that 'Growth in China, the region's largest economy, is projected to decline … because of an expected slowdown in export growth and a likely reduction in the fiscal stimulus in light of rising public debt, as well as continued structural deceleration.'

Government Response and Regional Context

Chinese policymakers have reportedly welcomed the World Bank's revised forecast, viewing it as an affirmation of the country's economic resilience and the effectiveness of recent fiscal support and industrial incentives. The Finance Ministry indicated that the projection 'reflects confidence in China's economic resilience,' while reiterating plans to prioritize sustainable and innovation-driven growth over short-term expansion.

The World Bank's report underscores a mixed economic picture for the region, where while China's near-term outlook improves, the longer-term challenges remain pertinent. The institution emphasized that the East Asia and Pacific region continues to outperform much of the global economy, but faces challenges such as rising global economic policy uncertainty and increasing trade barriers.