New normal in economic development

The history

"New normal" is nothing new. It was first popularized by the California-based bond fund giant Pacific Investment Management Co to describe below-average growth after the global crisis.

The term gained ground in China when in May, President Xi, during his inspection tour in Central China's Henan province, described the need to adapt to a "new normal" and remain cool-headed as the brakes went on.

The world's second-largest economy is having a rocky year, with growth having slid to a low not seen since the 2008/09 global financial crisis in the third quarter, dragged by a housing slowdown, softening domestic demand and unsteady exports.

This slowdown is labelled the "new normal," because there used to be an old one.

In the 35 years between 1978 and 2013, annual growth of the Chinese economy averaged close to 10 percent and, between 2003 and 2007, it was over 11.5 percent. Along with this came the change of the destiny of several hundred millions of Chinese, which were lifted from abject poverty.

However, the "good old days" cannot last forever. Growth decelerated to 7.7 percent in 2012 and 2013, and in the first three quarters of 2014, we saw a figure of 7.4 percent.

Even if this can continue, it is something not desirable, as the three decades of almost uninterrupted double-digit growth came at a high price of choking air pollution and exhaustive exploitation of natural resources.

It is long overdue to rethink China's growth story under a new normality, with new thinking and a new framework.