Libgdx Setup-ui makes projects Designed as JDk 1.6 , can i Change to 1.7 ?

Libgdx Setup-ui makes projects Designed as JDk 1.6 , can i Change to 1.7 ?

I mean, when i put the code from desktop that i made with JDK 7u in the project folder it complains that the arraylists are bla bla bla bla doesnt comply with 1.6.

So if i change everything to java 7, will everything works normally?