The International Monetary Fund urges China to implement reforms to achieve its economic transition and warned about growing vulnerabilities in its economy.

It's according to  IMF First Deputy Managing Director David Lipton Tuesday after his meeting with Chinese officials as part of the fund's annual review of the country's economy.

Lipton said while near-term growth are still supported by recent policies, there are few buffers to deal with any shocks. Lipton pointed out that China needs to align local government revenue and expenditure responsibilities, expand social security, and improve tax system.

The IMF has also warned about the growing risks in China's financial system, and anticipates China's economy to grow by around 6 percent in 2017.