AKIPRESS.COM - The U.S. and Japan-led bank cut its growth forecast for China to 6.8% from 7.2%, in its new Asian Development Outlook, Forbes reports.

Mongolia, exporter of gold and copper, is expected to suffer 2.7% drop in GDP due to a 0.2% drop in China’s expansion.

“The country expected to be most effected by China’s falling growth is Mongolia,” the ADB’s chief economist Shang-Jin Wei told reporters in Hong Kong. “It’s a pretty big number.”

Copper constitutes 36% of Mongolia’s exports, which makes the country highly exposed to external shocks arising in world commodity markets.

Mongolia stood out in the analysis because of its strong direct export links with China. Exports of copper provide 16.4% of its GDP, and crude oil and iron ore are other major components of its exports to China, the Asian Development Bank said.

The day after the report was released, the bank made an update. Instead of using a country-by-country basis – which said Mongolia would suffer more than any other commodity exporter – the bank aggregated data for a group of commodity producer collectively: Azerbaijan, Brunei Darussalam, Indonesia, Kazakhstan, and Mongolia. It said combined data gives a truer picture of the impact of slower demand for commodities.

The conslusion was that a slowdown in China’s growth of 1.0% causes growth to slow by an estimated average of 0.7% in this group of economies.