The ADB cut its GDP growth estimate for China by nearly 1 percentage point to 7.7 percent from the previous 8.5 percent, warning that risks to the world's second-largest economy were likely to intensify in the short term, given bleak global demand and the uncertain outlook for its largest trading partners.
"The global slump in demand, especially from Europe, will remain a serious drag on growth in the near term," ADB Chief Economist Changyong Rhee said in a news release as the Manila-based bank released an update of its regional outlook.
"The government has the means to cushion the economy from global turmoil, however. Its strong fiscal position, receding inflation and expansionary policy measures should ensure a soft economic landing, but it needs to expedite its effort to diversify the source of growth and strengthen structural reforms for inclusive growth."
Highlighting the extent of China's slowdown, an official survey also released on Wednesday indicated its normally robust services sector lost considerable momentum in September, with a key activity index falling to near two-year lows, as slow growth in manufacturing began to feed through to the rest of the economy.
The eurozone's unresolved sovereign debt crisis and the United States' looming fiscal cliff were the biggest risks to the regional growth outlook, with Asia's most open economies particularly vulnerable to spillover effects, the ADB warned.
* Industrial Growth Picking up
The industry sector performance has shown signs of stabilization and we can see an even clearer growing trend from the month-on-month figures in the third quarter," Zhu Hongren, the spokesman and chief engineer of the Ministry, told a news conference.
"Therefore, we expect that industrial output growth in the fourth quarter would be faster than that in Q3, which will help the country to achieve its annual economic growth target of... [continues]
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