Chinese gross domestic product increased at the slowest annual pace since 2009 in the third quarter, driving concern Europe’s debt crisis may dent growth in the world’s fastest-growing major economy. China’s policy makers will move to decrease its reliance on exports as President Hu Jintao and Premier Wen Jiabao begin their transition from power next year, said Isaac Meng, a senior vice president and emerging markets portfolio manager at Pimco.

“The government will choose to focus on structural change rather than quick solutions,” Meng said at a briefing in Sydney. “We’re looking in the next 12 months that there will be a cyclical moderation in growth to something about 7 percent, which is much slower than the traditional double-digit China norm.”

China’s economy expanded 9.1 percent in the third quarter from a year earlier, less than the median estimate of 9.3 percent in a Bloomberg News survey and down from a 9.5 percent increase in the previous three months, statistics bureau figures showed Oct. 18.

A successor to Hu is scheduled to be picked at a conclave of Communist Party leaders late in 2012, with Hu and Wen stepping down from their government posts in March 2013.

Rebalancing Growth

“The new policy makers have a really long horizon: five to 10 years,” said Meng. “They want to rebalance the growth to more sustainable domestic demand, consumption driven. Export- driven growth is no longer viable so a slower growth and rebalance to consumption is inevitable.”

Since Deng Xiaoping started the shift to free-market policies in 1979, China has grown at an average annual rate of 10 percent. Officials are trying to shift the economy to a more consumer-driven model after the global credit freeze contributed to a decline of about $230 billion in the country’s exports in 2009, the most since National Bureau of Statistics data began in 1979.

Exports were the equivalent of 27 percent of GDP in 2010. Growth in shipments to the European Union tumbled to 9.8 percent in September from 22 percent the previous month, data released this month showed.

The market has swung between expecting Chinese demand to support global economic growth to concern that the nation will face a financial crisis, Meng said. The Chinese government’s strong fiscal position and the nation’s high household savings rate are likely to allow the economy to cope with any problems that are generated by local government debt and the shadow banking industry, he said.

“These two balance sheets — public and household — will provide a backstop for macro and financial stability,” Meng said.