People bade farewell to year of Horse and brace up for the year of Goat, Sheep or Ram as it is called that begins on Thursday.

About three billion passenger trips will be made over the 40-day travel period, state-run news agency reported.

"We are proud of our great country and we are proud of our great people," Chinese President Xi Jinping said while Greeting people on the New Year.

"This year, we are facing situations no less challenging and complicated, and we must stay close to the people and promote reform, innovation, justice and a better standard of living with more vigorous efforts," he said.

He pledged more work on improving work styles in the Party and government and creating more wealth, more benefit for the people and called on people to keep a sober mind, avoid empty talk, make practical efforts and overcome all challenges.

The year of Horse is signing off with a baby boom as pregnant mothers rushed to have caesarean operations to have the babies before the New Year fearing the age old belief that those born in the Zodiac sign may lead to difficult lives.

Chinese lunar calendar, years are grouped into a 12-year cycle, with each year assigned an animal symbol i.e rat, ox, tiger, rabbit, dragon, snake, horse, sheep, monkey, rooster, dog and pig.

The year of dragon was believed to be the best as China's three top billionaires were born in that year.

"The idea that people born in the Year of the Sheep are likely to suffer misfortunes is absurd and widely misunderstood," says Gu Jun, sociologist in Shanghai University.

It originates in a folktale that people in the late Qing Dynasty (1644-1911) opposed to the Empress Dowager Cixi insisted that her zodiac sign -- sheep -- would endanger the country.

A contrary tradition says that people born in the Year of the Sheep are simply a reflection of the animal's mild and gentle nature, he said.

Folklores apart, 2015 is forecast by economists as the most challenging year for China as the economy continued to be on the slide.

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