"They will be spurred on by terrorist groups' public calls to carry out attacks in the West", said the assessment. "The Taliban are likely to continue to make gains, especially in rural areas", said the USA spy chief, adding that efforts to bolster local military have been less fruitful than hoped.
North Korea has been issuing clear warnings to the US against taking any kind of stance against it, cautioning that it has the firepower to destroy a large part of the USA landscape.
President Donald Trump is now weighing an increase of 3,000 to 5,000 USA troops in Afghanistan in an effort to stabilize the fight against the Taliban and terror groups there.
Coats also says the deal has enhanced transparency of Iran's nuclear activities.
Coats says China is targeting the USA government and American businesses. Progress on Iran's space program could shorten a pathway to an ICBM because space launch vehicles use similar technologies, ' Coats wrote.
Iran is continuing to work on ballistic missiles that would be capable of carrying nuclear weapons over thousands of miles, according to US Director of National Intelligence Daniel Coats.
Calling the DPRK "an increasingly grave national security threat" to the United States, Coats said the DPRK had taken "initial steps" toward fielding a mobile intercontinental ballistic missile.
China's Silk Road forum latest effort to boost Xi's stature
The original plan was for a host country press statement, but China changed that to a joint communique, the source said. Nepal wants investments for road and railway connectivity, which are key to the country's development, he said.
US-led forces have been fighting in Afghanistan for 16 years, making it America's longest war, yet the situation there remains a stalemate. Coats said Afghan troops suffer from "combat casualties, desertions, poor logistical support and weak leadership".
If left unchecked, Stewart added, the "stalemate" will deteriorate in the Taliban's favor, risking "all the gains" from USA -backed efforts there.
"Kabul's political dysfunction and ineffectiveness will nearly certainly be the greatest vulnerability to stability in 2017", he wrote.
State-led Russian hackers remain a "major threat" to the US government and will keep up their attacks after seeking to influence the 2016 presidential vote, Director of National Intelligence Dan Coats said in an annual "Worldwide Threat Assessment". He said that China still needs to do more to pressure North Korea before it will change its behavior and can do more.
They included Director of National Intelligence Daniel Coats, CIA director Mike Pompeo and acting Federal Bureau of Investigation director Andrew McCabe, who was newly installed after Trump fired the agency's chief James Comey this week.
Coats testimony was part of a list that included the interim Federal Bureau of Investigation director, Andrew McCabe, who spoke in lieu of his fired former boss, James Comey.
Information for this article was contributed by Matthew Pennington and Deb Riechmann of The Associated Press; and by Nick Wadhams and Tony Capaccio of Bloomberg News.