IMF chief "China should shift to consumption-led growth rather than exports"

Kristalina Georgieva, president of the International Monetary Fund and IMF, said China could no longer rely on exports to grow.

Georgieva told Reuters on Thursday local time that China's economy should not be overly reliant on exports and risk a severe slowdown in growth unless it transitions to a consumer-oriented economic model.

If the current economic structure is maintained, China's growth could fall below 4% in the medium term, which "will be a very difficult situation for China, especially on the social side," it said.

It also added that trade tensions caused by China's surge in exports will be a major topic ahead of the IMF and World Bank annual meetings.

The IMF noted that China could achieve higher growth rates if it could give consumers confidence to spend more.

Georgieva also said the Chinese government's recently announced fiscal stimulus package was in the "right direction," aiming to restore consumer confidence from the years-long property crisis.

A U.S. Treasury official opposes the IMF's comments that it is "too cautious" about China's industrial and exchange rate policies, saying it has long called for China's subsidy reforms and fair competition between state and private companies.