China's economic growth hit the full year target of 6.7 percent in 2016, with a faster than expected rate of 6.8 percent in the fourth quarter, but more proactive efforts may be needed to keep the strong momentum, economists said on Friday.
The performance in the fourth quarter bucked the trend of decline for the first time in the past two years.
"Generally speaking, China's economy was within a proper range, with improved quality and efficiency," said Ning Jizhe, the chief of the National Bureau of Statistics, at a news conference in Beijing.
The government had set a target range of 6.5 to 7 percent for annual GDP growth last year.
Industrial production grew steadily last year, with high-tech industry rising by 10.8 percent year-on-year.
The economic structure also improved, with the service sector accounting for 51.6 percent of the total GDP, according to NBS data.
The International Monetary Fund has revised upward its forecast for China's economic growth to 6.5 percent in 2017 on expectations of continued policy support.
But economists warned that the foundation for steady growth this year remains shaky, as growth of industrial production, fixed-asset investment, inflation-adjusted retail and property sales in the fourth quarter were either slower or flat compared with the previous quarter.
"We should be aware that the domestic and external conditions are still complicated, and the foundation for a stabilized but progressing economy should be further consolidated," Ning said.
Economists said that the top policymakers will need to walk a fine line with the country's fiscal and monetary policies to maintain steady growth.
"Fiscal policy will remain expansionary to boost infrastructure investment and fill the void left by the cooling property market. But we do not expect it to completely offset this drag," said Zhao Yang, chief China economist at Nomura Securities.
Most economists believe that Beijing will maintain a neutral, if not tighter, monetary policy to curb excessive money supply and to prevent potential asset bubbles that could endanger the country's financial system.
"Monetary policy faces a trade-off between growth, inflation, financial risks and capital outflow pressures. Maneuvering room for monetary policy is limited, and we expect the current neutral policy will continue in the near term," said Zhu Haibin, chief China economist at JP Morgan.
An external source of uncertainties for China's economic growth will be how the administration of new U.S. President Donald Trump engages with China, analysts said.
"The U.S.-China relationship is arguably the biggest external uncertainty for China, including bilateral issues as well as rising protectionism," said Zhu.
Jeremy Stevens, chief China economist at Standard Bank Group, said U.S. policies favoring import substitution could result in a tit-for-tat trade retaliation.