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Shanghai, China – U.S. Treasury Secretary Henry Paulson challenged China to speed its drive toward unfettered capital markets, as delay risks trillions of dollars in lost potential and higher volatility in the nation’s stocks.
“An open, competitive and liberalized financial market can effectively allocate scarcer resources in a manner that promotes stability and prosperity far better than government intervention,” Paulson said Wednesday at the Shanghai Futures Exchange. “Time is of the essence.”
Paulson recommended allowing limited-liability corporations, freeing controls on interest rates, accelerating sales of state-owned banks and reducing control of the exchange rate.
