What does Chinese slowdown mean for U.S.?

• Position: Your Life

China reported that its gross domestic product for 2015 was 6.9%, the lowest in 25 years. That figure prompted the International Monetary Fund to lower its global growth estimate for 2016. With U.S. stocks having a rocky first two months of the new calendar year and no sign of a turnaround, Forbes magazine posted an article urging readers not to panic.

While investors and businesses in the West will feel pain from the Chinese slump, Stephen Roach, a senior fellow at Yale University's Insitutute for Global Affairs and the former chairman of Morgan Stanley Asia, says they also should be optimistic about what he sees as an ongoing transition from an industrial economy to one built on services and consumer spending--noting that services now make up the largest part of the Chinese economy and the fastest growing.

With the government focused on spurring the transition to a consumer economy, Roach indicates that many people in the West need to work harder to understand how China is changing. "Most observers in the West are very fixated on the China they've come to know and don't appreciate what I call the next China, which is going to be a very different China."

That new China will not look much like the "World's Factory" model of the last few decades, which means...