China's recovery has extended to the services sector from manufacturing, making growth more broad-based and jobs more available, a senior economist said on Thursday.

"Given the current momentum, we expect China's GDP growth to accelerate to 8 percent in 2021 from 2.1 percent this year, benefiting from a low base. Economic activity should normalize further next year, supported by the lagging effects of policy stimulus in 2020 and an improving global outlook as COVID-19 vaccines become widely available," said Ding Shuang, chief economist for Greater China and North Asia at Standard Chartered.

With growth nearing its potential level, conditions appear ripe for policy normalization in China. Deleveraging and lowering risk are back on the agenda, Ding said.

"China has shifted into policy exit mode amid a firm domestic recovery and an improving global outlook. The country is expected to exit from expansionary fiscal and accommodative monetary policy in a mild way to steer off a policy cliff," he said.

Standard Chartered's economists expect fiscal consolidation and credit tightening. The People's Bank of China, the central bank, may guide total social financing growth to pre-COVID levels of 10 to 11 percent, consistent with nominal GDP growth, down from 13 to 14 percent in recent months. With a very low risk of overheating, they expect the PBOC to keep policy rates unchanged throughout 2021.

Ding said the Chinese government, instead of setting a specific growth target for 2021, is likely to aim for average growth of about 5 percent for 2020-21. Developing the domestic market, promoting industrial upgrading and achieving self-reliance in technology are high on the medium-term agenda.

Tang Jianwei, chief researcher at the Financial Research Center of Bank of Communications Co Ltd, said consumption and investment in the manufacturing sector will hopefully become the main driver of China's economic recovery.

Consumption growth of the country is expected to rebound to about 13 percent year-on-year in 2021, with offline consumption such as catering being a major force of consumption recovery, according to a report released by the Shanghai-based State-owned commercial bank on Thursday.

Factors including demand improvement, production acceleration and profit enhancement will push for a large rebound in manufacturing investment growth, which may reach around 13.5 percent in 2021 on a yearly basis, Tang said.