An easing in China's exportled economic expansion will help rein in headline growth across the developing East Asia and Pacific region to 8.3 per cent this year from an estimated 8.8 per cent in 2005, the World Bank said.
However, Beijing could reduce the risk of a sharper regional and even global correction by doing more to tackle its hefty and growing current account surplus.
In its Global Development Finance 2006 report, the bank projected that China will see the surge in exports experienced after its 2001 accession to the World Trade Organisation diminish over the medium-term.
"As higher oil prices take hold, reduced investment growth in China and reduced global liquidity are expected to slow regional growth to around 8.1 per cent by 2008," the report said.
"This reflects a modest slowdown in China, as slower export growth is partially offset by stronger domestic demand." The World Bank said China's volume of exports is forecast to rise by about 18 per cent, without specifying a time period. Last year, the country saw exports jump 28.4 per cent year-on-year.
The report did not give a country specific GDP forecast for China, but earlier World Bank forecasts put the growth rate at 9.5 per cent for 2006, down from last year's 9.9 per cent.
Excluding China, growth in the remaining economies in the region is expected to come in at about 5.5 per cent in 2006 through 2008.
The report noted, however, that global imbalances - in particular, a high-spending US and high-saving Asia - remain the critical risk to its forecasts.
It cited the need for China to build on its recent moves to increase exchange rate flexibility and boost domestic demand, reiterating messages issued by the International Monetary Fund and G7 group of economies earlier this year.
"As the market plays an ever increasing role in developments in the Chinese economy, the authorities will need to increasingly rely upon market mechanisms for its control," the report said.
China's foreign exchange holdings overtook Japan's this year, ballooning to $659.1 billion (£356.2 billion).