Moderate growth to continue in China - ADB

Hong Kong, China: Slowing investment growth and active implementation of structural reforms will push economic growth in the People's Republic of China (PRC) in 2014, continuing a more moderate but still robust pace of growth, said a new Asian Development Bank (ADB) report.

"The authorities are tightening credit growth and working to bring local government debt under control. They have also embarked on an ambitious reform agenda that will impact key areas of the economy," said ADB's Deputy Chief Economist Juzhong Zhuang.

"The reform agenda is critical and well-designed.

It has the potential to improve the quality of growth, make growth more inclusive, and ensure it is sustainable over the long term. But as the changes roll out, growth could slow further before it stabilises or rises again," he said.

ADB's flagship annual economic publication, Asian Development Outlook 2014 (ADO), released last week said the PRC 'the world's second largest economy' is set to post gross domestic product (GDP) growth of 7.5% in 2014 and 7.4% in 2015. The economy expanded by 7.7% in 2013, the same rate as in 2012.

Reforms expected to weigh on headline growth include state-owned enterprise reform and higher prices or taxes for energy, water and other utilities. Incentives for senior local government officials to focus less on quantitative growth targets will also affect growth.