WASHINGTON - China is undergoing a complex structural transition, and the lowering of its economic growth target in the next five years is a "smart move," Nobel Economist Michael Spence told Xinhua Tuesday.

China has "shifted priorities to things like energy efficiency, environmental issues, and some social investment. It's a smart move," Spence, a Standford Business School professor who has won the 2001 Nobel Prize in Economic Sciences, said at a conference in Washington D C.

Chinese Premier Wen Jiabao said?in his report to the Chinese parliament's annual session that the 7-percent GDP target for the next five years, the lowest in two decades, was aimed at bringing "significant improvement in the quality and performance of economic growth."

Spence said the balance of China's economy is changing, meaning the country will not rely excessively on exports.

Related readings:  China prepares to end GDP obsession  Trade surplus 'to decrease more' in 2011  Resident income to grow in 2011-2015  China's economy will not see 'double dip' in 2011

Responding to economists' concerns that China's growth model, mainly driven by exports of low-end manufacturing, would not be sustainable, Spence said the country has already recognized the problem and has taken measures to adjust it. However, he pointed out that the process cannot be completed overnight.

"The very labor-intensive process of manufacturing export will eventually die off. They will be replaced," he said. "It does not mean that China will not export any more, but that will be relatively high value-added export."

Spence said China and many other developing countries had taken extremely effective measures to tackle the financial crisis and global downturn. Now they are better positioned at least from the government debt perspective.

He also said the rapid growth of emerging markets has changed the global economic landscape. The systemic importance of emerging markets, especially larger economies like China and India, has increased dramatically.

Spence also noted that China has entered a rapid transition period to becoming a middle-income country, which entails a set of complex structural changes in the economy.

Regarding China's growth prospects, Spence said that if China can implement its 12th Five-Year Plan for the 2011-2015 period well, "it will sustain the growth."