China's urbanization should focus on the development of towns and counties instead of big cities, an official said on Friday.

"The development of towns should be combined with the development of rural areas. And the process should be fueled by developing relevant industries," He Keng, deputy head of the finance and economics committee of the National People's Congress Standing Committee, told a forum organized by Economy & Nation Weekly.

China's urbanization rate is expected to hit 55 percent by 2020, according to a research report released by the China Academy of Social Sciences. Urbanization is regarded as a key drive for China's economic growth in the coming decade.

At the end of 2011, about 50 percent of the Chinese population lived in cities and towns, according to the report.