The number of middle-income residents will increase to half of China's urban population around 2023 as a result of the country's growing economy, local media reported Thursday.

The number of middle-income dwellers in Chinese cities will rise 2.3 percent annually from 2010 to 2025, the Economic Information Daily cited a report by government think tank Chinese Academy of Social Sciences (CASS)as forecasting.

China had 230 million middle-income residents in cities in 2009, making up 37 percent of the total urban population, said the report released by CASS on Wednesday.

Families with their Engel's coefficient, or the proportion of income spent on food, standing between 0.3 and 0.373 were considered as middle-income residents, according to the report.

It said eastern metropolises like Beijing and Shanghai have a larger middle class compared with less-developed central and western regions.

In 2010, China's mainland urban population totaled 665.57 million, or 49.68 percent of the country's total population, official figures showed.

That represented an increase of 13.46 percentage points over the 2000 figure, as millions of farmers migrated to cities for jobs and better pay.

Slow integration of rural migrant workers into the cities, rocketing property prices, worsening living environment, unbalanced development of education and sluggish improvement of medical and health care services are major problems Chinese cities face, the CASS report said.

Around 50 million urban residents live in poverty, it said, defining poor families as those with an average per capita income below 7,500-8,500 yuan (1,166-1,321 U.S. dollars) a year.

The proportion of lower-income residents has dropped below 60 percent of China's urban population but is still above 50 percent, while the high-income group has expanded slowly and accounts for less than 10 percent of all city dwellers, said the report.