China's Need for Continued Economic Growth

While much of China's 2012 annual work report is in keeping with 2011's — calls for rebalancing the economy and increasing domestic consumption, for example — Chinese Premier Wen Jiabao has said that the government hopes to reduce growth to 7.5 percent. Wen's statement is an attempt at managing perceptions rather than a concrete step toward reduced growth. Given that China's external economy is weakening, and given that a slowdown in growth would create even greater social, political or economic hardship, China probably will support growth greater than 8 percent.