China should move faster on opening its financial markets for the sake of its economic growth and stability, US treasury secretary Henry Paulson said on Thursday in a speech to business leaders in Shanghai. This report from Quentin Sommerville:

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The country's success is built on low cost manufacturing but Mr Paulson says if it wants to offer more profitable goods and services then money needs to move more freely with fewer government controls. Despite extensive reforms China's banks are still state-owned. They're bureaucratic and unwilling to take risks. So they're unlikely to lend to new companies with innovative and potentially profitable ideas.

With the economy growing at 10 percent a year Mr Paulson said it is better to implement reforms during periods of economic strength rather than wait for things to go wrong and then try and fix them. The Chinese leadership recognises that the financial system here needs a lot of work. Mr Poulson's speech will be viewed as a friendly nudge in that direction. He's making good on his promise that the United States will no longer lecture China but work alongside it as it attempts to reform its economy.

Quentin Sommerville, BBC News, Shanghai

Listen to the words

well on the road
steadily moving (towards a goal), making good progress

to speed up reform
introduce positive changes more quickly

sustainable over the long term
able to continue for a long time

profitable
making money by selling goods or services

bureaucratic
involving a lot of complicated official rules and processes

unwilling to take risks
not wanting to do something because you know it may have bad results

innovative
new, different and better than what existed before

to implement reforms
to make, or introduce improvements

nudge
a gentle attempt to persuade or encourage someone to take a particular action

making good on his promise
keeping his promise, doing what he has promised to do