China’s real gross domestic product will grow by 8 per cent, down from last year’s 9.2 per cent but higher than the forecast 7.7 figure as the Asian giant recovers from a recent performance dip, according to Hang Seng Bank.

In a note from economists Andy Yao and Joanne Yim, the bank also predicts a slight strengthening of the renminbi exchange rate against the dollar to RMB6.2 next year from the current RMB6.2 level.

Like a lot of firms reflecting on the recent changes in the leadership of the Communist-run country, Hang Seng Bank sounded a broadly optimistic tune on China.

“Looking into the next decade, in line with the new growth target, mainland China’s economy is expected to grow more moderately than the last ten years, during which the growth averaged above 10 per cent,” the economists said. They went on to argue that weak external demand from other parts of the world is the main challenge for the mainland.

“Based on past experience, the new reform agenda will await the third plenary session of the 18^th Central Committee in the fall of 2013. But reform measures that have garnered broad support can proceed as planned, including income distribution, value-added tax reform and financial reform, including interest rate and exchange rate liberalisation, deposit insurance, and capital market development,” they said.