Impact of the People’s Republic of China’s Growth Slowdown on Emerging Asia: A General Equilibrium Analysis | Asian Development Bank

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Impact of the People’s Republic of China’s Growth Slowdown on Emerging Asia: A General Equilibrium Analysis

Publication | March 2016
Impact of the People’s Republic of China’s Growth Slowdown on Emerging Asia: A General Equilibrium Analysis

This paper assesses the potential spillover effects of the PRC’s slowdown on its neighboring economies.

As an important global and regional economic power, the PRC’s growth slowdown may cause large spillover effects to its neighboring economies. Using a multi-sectoral global computable general equilibrium model, this paper quantitatively investigates the impacts of a growth slowdown in the PRC for emerging Asian economies through trade linkages. The results suggest that a growth slowdown of 1.6 percentage points in the PRC would bring about a growth deceleration of 0.26 percentage points in developing Asia as a whole. However, the impacts vary dramatically by economy within developing Asia, reflecting their difference in economic and trade structure.

WORKING PAPER NO: 560