DALIAN, Liaoning - China needs to diversify its huge foreign exchange (forex) reserves by promoting overseas investment in the real economy such as infrastructure, economists and officials said.

Zhu Min, deputy managing director of the International Monetary Fund, said that ensuring safety and liquidity are top priorities in the management of forex reserves.

"The Chinese government is trying to diversify its forex reserves and take measures to slow their growth. That would be beneficial to the economic stability of the world as well as China," he said on the sidelines of the World Economic Forum on Thursday.