There will be no sudden economic crisis, former policy adviser predicts

China has the capacity to ensure a soft economic landing, and ongoing reform will bring new drivers to sustain growth, economists and industry leaders attending the "two sessions" said.

Neither the local government debt burden nor the shadow banking system will lead to a serious systemic problem in the short term, according to Yu Yongding, economist and a former monetary policy adviser for the nation's central bank, the People's Bank of China,

"China won't encounter a sudden economic crisis," said Yu. "For investors who've gotten out of China assets, it's natural to express pessimism ... 'We've been used to it.'"

China's banking sector remains solid, and the shadow banking sector is also well under control, said Yang Kaisheng, former chairman of the Industrial and Commercial Bank of China Ltd, the country's largest lender.

At the end of 2012, the shadow banking sector was equivalent to about 10 percent of GDP, while the figure in the United States was 150 percent, according to Yang.

"Compared with some developed countries, the scale of China's shadow banking sector isn't large.

"More important, leverage in the sector is low, because some of the popular derivatives common in the West are prohibited under China's regulatory framework," said Yang.

The economic deceleration is actually the government's deliberate choice, to allow time to upgrade the economy for higher-quality long-term growth, said Zhang Xiaoji, director-general of foreign economic relations at the Development Research Center of the State Council.

China has targeted GDP growth of 7.5 percent in 2014, unchanged from last year, according to a government work report delivered by Premier Li Keqiang at the parliament's annual session.

Li emphasized that the target was determined by considering the economy's growth potential and the need to strengthen market confidence, as well as to lay the ground for economic restructuring.

Ensuring adequate employment growth and a stable labor market are also key factors.

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