NEW YORK, March 5 -- The early stages of China's reform have already been set in motion, and further reforms such as boosting consumer demand and wider opening up to foreign investment are to be hoped for, a leading U.S. economist told Xinhua.

"The Twelfth Five-Year Plan and the third plenum of the 18th Central Committee of the Communist Party of China are already setting in motion the early stages of the transformation," said Stephen Roach, a senior fellow at Yale University and former chairman of Morgan Stanley Asia, when interviewed by Xinhua after the opening meeting of the second session of China's 12th National People's Congress on Wednesday.

"If you look at the structure of China's economy in the last two years, the services industry has grown by 3 percent to 46 percent percentage of GDP, larger than the combined share of manufacturing and construction for the first time in modern China's history," he said. The economist also mentioned the moderate GDP growth target of 7.5 percent set by the Chinese government for 2014.

He pointed out that if the target reflects the new economic model, which is driven more by services and eventually consumer demand, it is a good number for China.

"I really appreciate the fact that China can grow from one model, one structure to another, and growth rate can be slower. That would be good for China," he said.

Moreover, the economist believes that the emergence of Chinese consumers would benefit other countries as well.

"China is already the third largest and most rapidly growing major export market, so China's growing consumer demand could be an important growth opportunity for American companies, not just in the manufacturing area but also the services area," he said.

As a renowned expert on China, Roach also suggested that further expansion of the service sector could provide more employment in a country where a large portion of the population still live on very low income.

In addition, he is hopeful that China will move to be more open to foreign direct investment and transparent on the so-called negative list.

Speaking of social reforms, Roach said the third plenum really broke new ground, including loosening the one child family planning policy, reforming the hukou system, and potentially liberalizing deposit rates to provide more income to individual depositors.

"I'm very hopeful that the new leading committee and reforms set up by President Xi Jinping can be more effective in implementation than we've seen in the past," said Roach.