A decline in China's current account surplus has been driven more by investment than consumption, the International Monetary Fund director for Asia and the Pacific said Friday, raising concerns over the risk of internal imbalance.

Anoop Singh, speaking on the first day of the IMF-World Bank spring meetings, pointed out that Chinese consumption has actually been falling as a portion of GDP.

China's current account surplus dropped to about 2.7 percent of GDP in 2011 from over 10 percent in 2007. That metric is likely to remain subdued while the economies of China's two biggest trading partners - the European Union and the United States – struggle, respectively, with recession risks and anemic growth.

China needs to boost consumption while spending more on social programs and liberalizing its financial sector, Singh said.

According to data released by the National Bureau of Statistics last week, spending by households and the government proved resilient, contributing 76 percent in the first season of 2012, up sharply from an average of 41.6 percent during the past decade.

Questions about the valuation of the yuan were raised during Singh's briefing on Asia Pacific matters. The IMF official said the issue is under review and assessments of the currency's valuation can be expected "in the coming months."