Finding the right direction

Stephen Roach, former chairman of Morgan Stanley Asia, believes the government target in 2015 will be 7 percent. [Provided to China Daily]

In the third quarter of last year, China grew by 7.3 percent－the weakest quarterly growth for five and a half years－and when the National Bureau of Statistics releases the figure for the full year later this month, it is likely it will have missed its 7.5 percent target.

There is much anticipation as to what target the government will set for 2015 in March at the annual meetings of the National People's Congress and the Chinese People's Political Consultative Conference.

The majority of commentators believe it will either settle on 7 percent or opt for flexibility with a range of between 7 and 7.2 percent or, more likely, 7 to 7.5 percent.

The People's Bank of China, the central bank, forecast 7.1 percent growth for 2015 in a recent research report.

Stephen Roach, former chairman of Morgan Stanley Asia and author of Unbalanced: The Codependency of America and China, believes the government target will be 7 percent and the outcome will be very close to that.

"It could be a little less than that and it also could be a little more. The government has a lot of policy levers to deploy to ensure it keeps it at that level and I think there is still a lot of natural growth left in the economy, particularly from urbanization.

"For me, what is more important than the actual number is the mix of the growth and the need for evidence of a further move to services and consumption and away from exports."