Australia iron ore mining
Trucks wait to be loaded with iron ore at the Fortescue Solomon iron ore mine located in the Valley of the Kings, around 400km (248 miles) south of Port Hedland in the Pilbara region of Western AustraliaReuters

The ongoing growth slowdown in China will hit Australia and New Zealand – the nations that depend largely on commodity exports to the world's second largest economy, according to the World Bank.

According to the bank's latest east Asia and Pacific economic update, a sharp slowdown in China "would exert large spillovers" across East Asia and Pacific. The region's developing countries will face growth slowdown, despite its benefits from lower oil prices and a continued economic recovery in developed economies.

The World Bank predicts that a one-time 1-percentage-point decrease in China's gross domestic product (GDP) growth would reduce growth in the region by approximately 0.2 percentage points.

"The impact would be relatively larger for commodity exporters, and for economies more tightly integrated into regional supply chains," the bank said.

"In addition, the significant negative impact on Australia and New Zealand, among the world's largest commodity suppliers, would lead to indirect spillovers on the Pacific Island Countries, given their tight links through trade, investment, and aid."

In Australia, growth rose to 2.7% for 2014 as a whole, but has decelerated sharply since the first quarter of 2014. The country has been reliant largely on its mining sector, but declining prices for key export commodities, including mineral fuels and iron ore, have depressed mining investment.

Given the country's weak growth outlook, the Australian dollar has weakened against the US dollar. The US dollar is trading up 1.08% against the Australian counterpart at $1.3163 as at 2.07 am ET.

The World Bank's warning comes as China posted weak trade figures for March, prompting fears that the country's growth would come down below 7% in the first quarter.

In 2014, China posted a growth rate of 7.4%, the weakest pace since 1990. The World Bank expects the China economy to grow at a rate of 7.1% in 2015, 7% in 2016 and 6.9% in 2017.

"In China, as it shifts to a consumption-led, rather than an investment-led, growth model, the main challenge is to implement reforms that will ensure sustainable growth in the long run," said the World Bank.