China’s state assets regulator warned last week that the country’s state-owned companies (SOEs) had to be prepared for a period of downturn as the world’s second-largest economy may end its near-double digit growth that lasted for decades.

“The SOEs need to fully recognize the severity and urgency of current situation, and make timely preparations to weather the upcoming storms and winters which will last for three to five years,” said Shao Ning, deputy director of the State-owned Assets Supervision (SASAC), according to a statement published on the website.

The deputy chief predicted that Chinese economy is set to enter “an era of austerity”, after posting nearly 30 years of high growth.

“Against the current harsh economic situations both home and abroad, the SOEs must attach much importance to reducing costs..and boosting efficiency,” he said.

His remarks were made at a working conference aimed to strengthen management within the SOEs.

According to the SASAC, the largest three economies in the world remains and will stay weak in 2012, while debt crisis in the European continent is spreading and demand globally keeps shrinking, which, work together, will drive the global economy into a long-term of depression.

In a blog published on Caijing, Xu Xiaonian, a renowned Chinese economist, said:” No matter what measures will be taken in the next half of this year, I personally believe, the [current] trend of downturn couldn’t be reverted,” as long as the government continues to make growth a priority to restructuring economy.

He urged policy makers to stop using expansionary monetary policy to boost domestic demand, and start the restructuring of economy.

A China International Capital Corp (CICC), which was revealed on Tuesday, cut China’s GDP growth to 7.8 percent from previous 8.1 percent and to 8.3 percent from 9.0 percent, respectively for 2011 and 2013. It also cut forecast for inflation, from 3.3 percent to 2.8 percent.