"As part of the world economy, China certainly would be affected by the current financial crisis," Liu Erfei, managing director of the U.S. investment bank's China office, said. "We expect the country's economy to slow down from its double-digit growth to an 8 or 9 percent (annual GDP) increase, still relatively rapid."

Liu said China did not over-leverage itself as did other countries, including the United States, and also did not invest in sub-prime financial products, Xinhua reported. The Chinese government also was credited with keeping control of capital, which helped the country maintain its stable economic performance, the state-run news agency said.

Merrill Lynch's research also showed domestic consumption will become the main driver of China's growth as export demand shrinks.

"Our view on China's economy in the next five to 10 years is very optimistic," Liu said.