Innovation key to growth model shift in China's economy(2)

Economy to maintain modest growth rate

China's economy is recovering but the days of torrid growth are gone as it faces mounting pressure to restructure its economy to achieve sustainable long-term growth.

China's manufacturing activity grew in November for the second month in a row, official data showed, in a further sign of strength in the world's second-biggest economy after a marked slowdown.

The purchasing managers' index (PMI) rose to 50.6 percent in November from 50.2 percent in October, above the 50-percent figure that demarcates expansion from contraction, according to data released by the China Federation of Logistics and Purchasing.

Given the recent signs of recovery, many analysts expected the economy to snap out of its longest downward cycle since the global financial crisis, and start to trend upwards in the fourth quarter.

On China's future growth rate, prominent Chinese economist Cheng Siwei thought that China's economy will grow about 7 percent in the future, within the range set in the "Twelfth Five-Year Plan (2011-2015)".

Echoing Cheng's view, Gu Shengzu said moderate growth rate of above 7 percent can keep China's economy stable, sustainable and healthy.

But economists also warn of downside risks from still cloudy external markets. The European debt crisis and listless U.S. economy continue to crimp demand from China's two largest trade partners.

Chinese Minister of Commerce Chen Deming said China is certain to hit the government's economic growth target of 7.5 percent for 2012.

Gurria estimated that China's growth would be at 7.5 percent to 7.7 percent this year, and could expect "a higher growth in 2013 and even higher growth up to 8 percent in 2014," adding that it would maintain at this rate for fifty years.

Despite rosy picture, Gurria warned that China also faces challenges and needs to mull over "how to sustain a relative high rate of growth."