The Chinese economy is heading for a soft landing, though downside risks are still simmering, according to a recent report of the World Bank.

Bert Hofman, the bank's chief economist for East Asia and Pacific, said the leading indicators projected further softening for China in the coming six to 12 months, but they do not signal an immediate hard landing.

Nevertheless, the growth is expected to slow as external demand weakens and China pushes its own structural adjustment towards economic growth driven more by domestic demand.

The World Bank expected the Chinese economy to grow 9.1 percent in 2011 and 8.4 percent in 2012.

"While the central projection is for a gradual deceleration of growth, the risks are tilted to the downside. The global outlook has become increasingly precarious as advanced economies growth turned more sluggish than previously anticipated and uncertainties continued to loom over the euro area sovereign debt," the report said.

Hofman said he saw the risks in China in the banking system and the property market, but nevertheless the Chinese authorities were aware of the risks and that they were under control.

The process of structural adjustment is likely to reduce headline growth over the medium term, but will place the country's longer-term prospects on a more solid footing, he said, adding that experiences of other countries show it is still possible for China to achieve multiple years of high growth going ahead at the current stage.

As demand weakens in developed countries, China's share in world imports has grown, making it an increasingly important source of global demand. A shift to more consumer goods imports in China is also benefiting the region's manufacturing exporters, said the report.