China is on track to become a high-income nation, with low systematic financial risk, US investment bank Morgan Stanley has forecast.

In a report focusing on China’s economic transformation over the next 10 years, Morgan Stanley forecast that the country will break out of the middle-income bracket and join the rarified ranks of a high-income society with income the equivalent of $12,900 per person by 2027.

The positive outlook is based on a pattern of increasing consumption in China, growing service sectors, higher value-added manufacturing, continuing enterprise transformation and efforts to cut overcapacity.

According to the report, released Feb 14, those factors will play important roles in China’s economic transformation in the decade.

The analysis drew attention from international media organizations, such as Bloomberg News, Reuters and Financial Times.

Bloomberg News said that the Chinese government has attached more attention to risk control not economic growth speed, which is an important reason that it holds positive expectations on China’s economic transformation.

According to data from the National Bureau of Statistics, the consumption contributed 65 percent to economic growth in 2016, 4.9 percent higher than in 2015.

“Consumption and services will come to dominate the economic landscape,” Morgan Stanley predicted.

Premier Li Keqiang refueled a truck on the assembly line during his visit to a heavy truck plant of Dongfeng Commercial Vehicle Co in Shiyan city, Central China’s Hubei province, on May 23, 2016.

In the past year, China’s service and manufacturing industries have witnessed a lot of development.

Premier Li Keqiang repeatedly spoke about building a powerful manufacturing country and has pushed products and industries to reach middle-high ends.

High-value-added manufacturing is also highlighted in the report. China will ramp up its competitiveness against other traditional leaders in telecom equipment, semiconductors, railways and power supply infrastructure, Morgan Stanley said. Meanwhile, China showed its determination in cutting redundant industrial overcapacity. Last year witnessed a capacity cut of at least 45 million tons of steel and 250 million tons of coal.

All these efforts have strengthened the international community‘s confidence in China’s economic transformation.

Economic transformation had been promoted by the Chinese government throughout 2016. Premier Li emphasized at several occasions that efforts should be made to strengthen consumption through reform and innovation, especially effective supply of service sectors. He said China should combine cultivating new economic drivers with upgrading traditional ones to form two engines to drive China’s economy.

Along with Morgan Stanley’s report, international organizations, including the United Nations Conference on Trade and Development, European Commission, UBS Securities and the Royal Bank of Scotland, also have positive expectations for China’s economic growth.