For years, there’s been one constant for people talking about the Chinese economy: GDP growth would exceed 8 percent. It didn’t much matter what happened in the rest of the world—the U.S. and other export markets might be thriving or might be struggling, but China would grow at least 8 percent, year in and year out. The country needed to create enough jobs for the millions of young people entering the workforce every year, and the Chinese leadership decided that anything below 8 percent would put job creation in jeopardy. And the policy makers were consistent: The last time China had a growth target below 8 percent, George W. Bush was still in his first term and the Boston Red Sox still hadn’t broken the Bambino’s curse.
That magic, 8 percent number, though, is now history. At his annual address to open the National People’s Congress in Beijing, Chinese Premier Wen Jiabao on March 5 announced that the government has a GDP target of 7.5 percent this year. China hasn’t had a growth target that conservative since 2004.