China has announced a return to double digit economic growth - raising the prospect of a wider recovery from global recession.
Analysts also believe China is on track to overtake Japan to become the world's second-biggest economy.
China says its economy expanded by 10.7% during the final quarter of last year - compared with the same period in 2008.
GDP growth surpassed the government's target of 8% for the full year, a level that is seen as crucial to foster job creation and stave off social unrest in China's urbanising population of 1.3bn people.
A Chinese government spokesman said the economy expanded by 8.7% during the whole of 2009 and the pace of growth increased as the year went on.
But China's biggest rise in inflation in 13 months underlined the broader challenges of rapid growth, and came as the World Bank and International Monetary Fund warned anew that the country could face a US-style bubble.
Ma Jiantang, commissioner of the National Bureau of Statistics, credited a government stimulus package worth four trillion yuan (€417bn) with sustaining growth in a year when much of the global economy was in crisis - China was hit by the global crisis but not as badly as other large economies.
'We need to prevent the overly fast increases in prices and keep a close eye on the trend in prices,' he added at a news conference, but said he believed inflation in 2010 should be 'mild and controllable'.
