As China struggles to maintain the official target of 7.5 per cent growth rate this year with prospects of further slowdown in the next two years, the World Bank today said the world's second-largest economy can cut the targets and focus more on reforms.
"Our policy message is the focus should be on reforms rather than meeting specific growth targets," Karlis Smits, Bank's senior economist in Beijing said while releasing the update on Chinese economy.
"In our view, an indicative target of around seven per cent for 2015 would meet the kind of indicative growth that is needed to maintain stability in the labour market," he said.
China's growth continued to moderate reflecting renewed policy efforts to rebalance the economy, the update said.
The average growth for 2015-16 is expected to ease to slightly above seven per cent as policy efforts to place the economy on a more sustainable growth path are likely to intensify, it said.
China's economy grew at its slowest pace since 2009 in the third quarter of this year prompting concerns that it may miss the official target of 7.5 per cent for the first time in 14 years.
Gross domestic product (GDP) expanded 7.3 per cent from a year ago in the third quarter, compared with 7.5 per cent in the second quarter and 7.4 per cent in the first quarter of this year, the NBS data showed.
The GDP growth in the July-September period marked the slowest quarterly growth since the first quarter of 2009 and was in line with market expectations.
Observers say that the slow growth may result in China missing the official growth target since 1999 and the government may resort to stimulus measures to revive the economy.
The World Bank however is very supportive of measures initiated by China to cope up with the slow down.
"The growth in China continue to slow this year. The slowing growth reflects policy steps to put economic growth on more sustainable footing," Chorching Goh, Bank's Chief of the Economic Unit and Lead Economist said.
There have been greater policy efforts to tighten credit growth to reduce excess capacity in certain industries, to internalise costs of industrial pollution and also to heighten budget constraints of local governments, she said.
