China is set to surpass the U.S. as the world’s largest economy by 2028, with growth above 5% over the next two decades, Bank of Communications (BoCom) said in a report. The bank’s baseline forecast sees China’s gross domestic product growing at 6.5% in the next three years, and the average annual growth rate will be at 5% between 2021 and 2035. China’s GDP will exceed those of the U.S. and Europe combined by 2050, according to BoCom. The bank said the target will be met if reforms progress steadily and production continues to improve efficiently.

Essential reforms, BoCom said, include cutting capacity within traditional high consumption industries, encouraging innovation and advanced technology, expanding the opening up process, balancing regional economic development, and drafting effective and prudent policies. “China’s economy could yet grow relatively fast if reforms progress steadily,” said Lian Ping, Chief Economist of BoCom. “The strict bottom line is to prevent systematic financial risks.” He said household consumption and higher added value exports will be the main drivers for China’s economic growth.

China’s GDP grew 6.9% in the first three quarters, above the official annual target of 6.5%, and 6.7% in 2016. But official economic indicators showed growth of factory output, investment, and consumption in October all slowed from September. November’s retail sales amounted to CNY3.41 trillion, a slight drop from CNY3.42 trillion in October, and 10.2% higher than a year earlier. Industrial output rose 6.1% in November, a slight slowdown from 6.2% in October, while fixed-asset investment in the first 11 months also slowed slightly to 7.2%, according to the National Bureau of Statistics (NBS). Real estate development investment increased by 7.5% year-on-year in the first 11 months. China’s exports surged 10.3% in November, much higher than market expectations.