China's economic slowdown and an impending rise in U.S. interest rates will lead to lower growth in East Asia this year, according to a recent World Bank report. The East Asia Pacific Update, which was published on Monday, predicts that the region's economy will increase by 6.5 percent in 2015 - down a few points from 6.8 percent in 2014.

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China's economy is expected to grow at seven percent this year. However, the report notes that the country's economic growth rate will reduce gradually over the next two years. China is experiencing a rare slowdown as authorities reform the economy to become more market-based.

Chinese officials recently released data showing that the country's economy grew by the forecasted rate of seven percent in the first half of this year. While accommodating slight deviations, officials have expressed confidence that the country's economy will maintain this growth rate in the second half of the year. But some critics have casted doubts on the accuracy of the data given that China recently revised its 2014 growth rate from 7.3 percent to 7.4 percent due to the poor performance of the service sector.

According to the World Bank, China's economy will not experience any sharp depreciation. However, the bank warns that if the country's growth rate dips further, it could adversely affect the economies of neighboring countries that heavily depend on China.

The report predicts that the rise in U.S. interest rates in the coming months could compound the problem for weakening economies in the region.  

The World Bank East Asia and Pacific Vice President Axel van Trotsenburg explained in a statement that authorities in the East Asian region must focus on structural reforms to ensure "sustainable, long-term and inclusive growth."

The report also calls for reforms to encourage private investment and sound macroeconomic management to sustain the region's economic growth.

The World Bank is not the first international lender to predict a lower growth rate in 2015. Last month, the International Monetary Fund (IMF) also cut its global growth forecast due to the slowdown in many developing economies.

Alonso Segura, Peru's economic minister has announced that China's economic slowdown and the impending U.S. interest rate increase would be at the center of discussions during a meeting between the World Bank and the International Monetary Fund (IMF) in Lima this week.

TagsWorld Bank East Asia Pacific Update, china economic growth, East Asia Economic Growth