A report released on Monday shows that growth in China's economy is expected to reach 7.6 percent in 2013 and then edge down to around 7.5 percent in 2014, Beijing Times reported on Tuesday.

The report, jointly issued by the State Information Center and Social Science Academic Press, also issued forecasts on the economic hot issues of next year and on macro-control policies.

GDP to expand 7.5 percent and CPI to grow 3.2 percent

China is now attaching more importance to structural adjustment and growth quality, and improving the driving forces giving vitality to economic growth. China's GDP is expected to increase by 7.6 percent this year, and its Consumer Price Index (CPI) by 2.7 percent.

Damping inflation will remain the main task of macro regulation in 2014. The CPI is expected to rise by around 3.2 percent in 2014, according to the report.

Housing prices may rise 5 percent in the coming year, but if local government debt is not properly handled a rapid decline in housing prices cannot be ruled out.

Four problems facing China's economy

The following four major issues and risks facing China's economy were fully considered when we forecast the above figures, said Zhu Baoliang, director of the forecasting office of the State Information Center.

First, overcapacity is not limited to traditional industries; emerging sectors have also had to deal with excess capacity.

Second, investment is still growing in industries which are already facing overcapacity, which will further exacerbate the current problem.

Third, a clear differentiation can be seen in the real estate market between China's first or second tier cities and third or fourth tier cities. A housing bubble in the former continues to grow and there is excess supply in the latter. Should any recession occur in the real estate market in the third or fourth tier cities, it could pose a risk to the whole housing market and ultimately cause financial problems.

Fourth, the rising operating costs will result in insufficient consumption and overcapacity of enterprises, which will influence future investment and technical innovation.

Edited and translated by Liang Jun