The world's second-largest economy is facing sluggish internal demand and a protracted property sector crisis, as well as the possibility of a deepening trade war with the US under President Donald Trump.

The Purchasing Managers' Index (PMI), a key measure of industrial output, came in at 50.2 in February, according to the National Bureau of Statistics (NBS), above the 50-point mark that separates growth and contraction. February's reading was up from 49.1 in January, when factory activity shrank for the first time in four months.

Production was boosted in February by the "gradual resumption of work by enterprises after the Chinese New Year," said NBS statistician Zhao Qinghe.

Non-manufacturing PMI, which measures activity in the services sector, came in at 50.4 in February.

Chinese President Xi Jinping has admitted the country's economy still faces "numerous difficulties".

China's leadership convenes next week for the "Two Sessions" meetings, where analysts expect them to hammer out plans to shield the ailing economy from tariffs and trade threats from the Trump administration.

Trump this week announced an additional 10 percent tariff on Chinese imports, on top of an existing levy of the same rate imposed earlier this month.

Zhiwei Zhang, chief economist at Pinpoint Asset Management, said it remained to be seen "how much will the US raise tariff next week, (and) how damaging will it be for China's export orders".