Fitch issues warning over growth model

"But as a developing and transitional economy, China certainly faces many challenges to tap into this potential," Lin said at a forum jointly held by the National Committee on US-China Relations and the China Center for Economic Research in New York on Monday.

Even with the best economic models as measurement, Lin said, the Chinese economy is like a glass that's half-full or half-empty, depending on how it's viewed.

His GDP forecast was based on China's quest for growth driven by consumption by the growing middle class as well as expected acceleration from the comparatively slow growth of 2012.

Among the challenges China faces, according to Lin, are income disparity and corruption, which combined could produce social tensions, and the need to exert discipline in tackling these problems.

The world's second-largest economy slowed to a growth rate of 7.4 percent in the third quarter of 2012, the seventh consecutive slowing down amid the contraction of industrial sectors and weakened external market demand.

Economic indicators, including industrial output, fixed-asset investment and consumption, have shown signs of a rebound since the fourth quarter, which consolidated the market expectation of GDP growth about 7.8 percent during October to December.

Economists predicted that the whole-year growth for 2012 would beat the 7.5 percent target.

Greater domestic consumption and infrastructure investment will support the rebound, according to a report by the Institute of Economic Research at Renmin University of China.

"China's domestic market is growing rapidly, and this will remain a key driver for the country to maintain economic growth," said Wang Jianye, chief economist at the Export-Import Bank of China.

"While domestic investment has and will generate economic growth in the coming years, China's stable fiscal policy will also help the country's stable growth," he added.

Contact the writers at chenjia1@chinadaily.com.cn