I'm John Batchler. I welcome Joseph Sternberg, member of the editorial board of the Wall Street Journal.

He writes political economics column. He's in London watching his old haunts in China.

Joe was for many years at the Wall Street Journal in Hong Kong, and we spoke every week when

it was routine at this time of year to learn that China, the Chinese Communist Party under various leadership,

was reporting expectation of 9 to 10 percent GDP growth this year again and again and again.

Well, here we are 15, 20 years later.

And, Joe, a very good evening to you.

I learned that the GDP growth target for the People's

Republic of China is 4.5 to 5, which you identify as the lowest since 91 before I started

tracking it. Is that a positive or a negative? Are they retreating or advancing with 5%, which is

about half of what their expectations were when

you and I started talking in the teens. Good evening to you. Hey, John. Well, I mean, as most

things involving China's economy these days, the answer is a little bit of both. So, sort of the

positive spin on this very, very conservative economic growth target for the coming year would be that officials in Beijing understand that the Chinese economy needs to undergo a dramatic transformation.

It needs to transform away from what it has been, which is an economy that was

heavily dependent on real estate, on infrastructure projects funded by local governments,

often supported by borrowing on the back of real estate, and by excessive investment in

manufacturing capacity for export. that China needs to pivot into

a kind of economy that's much more dependent on services and domestic consumption.

And that kind of transformation in most places where it's ever happened entails a period

of slower economic growth.

So I think that there's one school of thought that

...