Chinese Economy Ends 2016 on "Positive Note" The Chinese economy ended on a positive note in 2016， with both the manufacturing and service sectors registering strong increases in business activities in the final month of the year， according to a private survey.

Chinas service sector continued to expand in December last year， posting its strongest rate in 17 months， according to the survey.

Demand in the sector picked up as new orders at service companies rose in December at the fastest pace in 17 months.

Rising raw material costs for service companies caused expenses to soar at their quickest rate in nearly two years， but service providers only slightly raised their prices in December due to market competition.

Optimism about growth prospects in 2017 reached a fourmonth high， with surveyed companies generally showing more confidence due to improving market conditions and company expansion.

Expert said， "The Chinese economy performed better in the fourth quarter than in the previous three quarters. It is without question that the government full year growth target will be reached."

Chinas GDP grew 6.7 percent in the first three quarters of 2016， within the government target of between 6.5 and 7 percent for the year.

GDP growth in the fourth quarter of 2016 is expected to stay flat at 6.7 percent year on year， partly due to stronger fixed asset investment and retail sales in December， according to China International Capital Corporation.

National Bureau of Statistics data showed that Chinas manufacturing and non-manufacturing PMI posted the second-highest monthly reading of 2016 in December， adding to signs of economic stabilization.

Expert said positive factors have grown for the Chinese economy， including increasing demand， rising prices， better performance for companies， restructuring and a good job market.

However， expert also warned that China should stay alert about downward pressures on the economy， with gradually tightening property policies and likely tightening of fiscal and monetary policies.

China is facing a complicated situation both at home and abroad， including weak growth momentum in major economies， rising trade protectionism， domestic debt overhang， excess capacity and a highly leveraged property market.

China has made "seeking progress while maintaining stability" the main theme for economic work in 2017， pledging to push for substantial progress in supply-side structural reform， according to the Central Economic Work Conference.

Expert said the government should set a more flexible target for economic growth in 2017 to make more room for reforms， proposing a GDP growth target range of 6-7 percent for 2017.

Chinas Economy Likely to Grow 6.7 pct in 2016

Chinas economy is estimated to grow by about 6.7 percent in 2016， the top economic planner said.

The economy would exceed 70 trillion yuan （about 10.1 trillion U.S. dollars） last year， an increase of 5 trillion yuan， minister in charge of the National Development and Reform Commission， told a news briefing.

Steady growth and the performance of new sectors have debunked predictions that Chinas economy will collapse or face a hard landing， and the growth rate was remarkable among major economies， he said.

Citing a report by the International Monetary Fund， he said that China may have contributed 1.2 percentage points， or over 30 percent， of the worlds economic growth in 2016， while the United States might account for 0.3 percentage points.

This would mean China has been the top engine of global growth for 10 years in a row.

China is confident in and capable of maintaining the reasonable growth rate thanks to its economic structural reforms and emerging new sources of growth， expert said.

As China adapts to a new normal of moderate-to-high growth， it has tried to shift from an export-and-investment driven economy to one that is more sustainable and draws strength from consumption， services and innovation.

In the first three quarters of 2016， the economy expanded 6.7 percent， well within the governments target range of between 6.5 and 7 percent.

During that period， the service sector accounted for 52.8 percent of value-added industrial output， 13.3 percentage points higher than secondary industry， while consumption accounted for 71 percent of the growth， up 13 percentage points， expert said.

Meanwhile， value-added industrial output of the hightech manufacturing sector and innovative industries increased 10.6 percent and 10.87 percent， respectively， from the previous year， expert said.

The economy is in better shape for cleaner development，with a five-percent drop of energy consumption per unit of GDP and continuous declines of major pollutant emissions， he added.

Besides， the country has exceeded its annual target for job creation， adding over 13 million new jobs in 2016.

The latest sign of a warming economy came as the National Bureau of Statistics （NBS） said Chinas producer price index （PPI）， which measures costs for goods at the factory gate， narrowed its decline in 2016 from the previous year.

PPI for the whole of 2016 dropped 1.4 percent year on year. The pace of decline was 3.8 percentage points narrower compared to that of 2015.

The reading increased 5.5 percent year on year in December 2016， the biggest gain since September 2011 and marked the fourth straight month of increases.

A rebound in PPI could boost corporate profits and lower financing costs， said Deng Haiqing， chief economist with JZ Securities.

The NBS also released figures on Chinas consumer inflation in 2016， with the consumer price index rising two percent， a reading below the governments three-percent target.

World Bank Predicts Chinas Economic Growth Rate for 2017 at 6.5 pct

In January， the World Bank kept its forecast for Chinas economic growth rate for 2017 unchanged at 6.5 percent， saying that the economy will continue sustainable growth as it is rebalancing from manufacturing to services， despite reemerging concerns for property markets.

In its latest flagship Global Economic Prospects report， the Washington-based lender expected the Chinese economy to grow 6.5 percent in 2017 and 6.3 percent in 2018， unchanged from the forecast it made in June 2016.

Macroeconomic policies are expected to support Chinas key domestic drivers of growth despite softness of external demand and overcapacity in some sectors， said the bank.

It expected that Chinas efforts to rebalance its economy from industry to services， and from investment to consumption will continue moderate progress.

According to the World Bank， China could secure a sustainable growth in the medium term while avoid a sharp slowdown， if the country continues to push forward additional fiscal reforms， further state-owned enterprises reforms and land and labor market reforms.

"Elevated credit growth， which has been accompanied by rapidly rising housing prices， is an important challenge，" said the bank. It suggested that reforms in corporate sector and tighter prudential measures would help rein in credit growth and thereby reduce macroeconomic and financial stability risks.

In regard to concerns about the capital flows， Ayhan Kose， director of the World Bank Development Economics Prospects， said that the capital outflows have actually eased in 2016 and will continue to slow further in 2017.

According to the economist， repayment of dollardenominated debt by Chinese corporates， which was one of the key forces behind the outflows， will continue to moderate this year.

In addition， Chinas outward direct investment seemed stabilized and Chinese authorities have taken measures to avoid financial market volatility， which have already seen benefits， said Kose.

Also， the World Bank downgraded the global growth forecast for 2017 to 2.7 percent， compared to a 2.8 percent estimate made in June 2016. But the growth rate was higher than the 2.3 percent increase in 2016， mainly driven by improvements in emerging market economies.

Chinese Economy Shows Solid Foundation

Chinas GDP growth is expected to fall solidly in the target range of 6.5 percent to 7 percent as both official and private data point to a stabilizing economy.

Chinas manufacturing sector continues to expand， with the purchasing managersindex （PMI） hitting a 47-month high in December， a private survey showed.

Official manufacturing PMI， which surveys larger companies， stood at 51.4 in December， lower than 51.7 in November but above the boom-bust line of 50 for the fifth straight month， the National Bureau of Statistics （NBS） said.

"The Chinese manufacturing economy continued to improve in December， with the majority of sub-indices looking optimistic，" said the director of macroeconomic analysis at CEBM Group， a large investment research firm.

Alongside booming factory output， profits of Chinas major industrial firms increased 14.5 percent year on year in November， up from 9.8 percent in October， official data showed.

Chinas non-manufacturing industries also showed strong expansion in December， second only to November this year， the NBS data showed.

GDP growth in the fourth quarter of 2016 is expected to stay flat at 6.7 percent year on year， with stronger fixed asset investment and retail sales in December， according to China International Capital Corporation.

Chinas target for GDP growth was 6.5 percent to 7 percent in 2016， and it saw stable 6.7 percent growth in the first three quarters.

"However， it remains to be seen if stabilization of the economy can be consolidated， due to uncertainty if restocking and consumer price rises are sustainable，" expert said.

The basic plan of "seeking progress while maintaining stability" will be an important principle in state governance and methodology for economic work， with implementation of critical importance for 2017， according to the Central Economic Work Conference.