The International Monetary fund is welcoming China's deregulation of interest rates and other changes to improve the business climate and encourage small enterprises.

China said last week it was ending controls on bank lending rates in a move toward creating a market-oriented financial system to support economic growth. Banks currently lend mostly to state industry rather than to entrepreneurs who create new jobs and wealth. Allowing banks to negotiate their own rates with borrowers could channel more credit to private enterprise.

The ruling party has promised changes to support credit-starved entrepreneurs, including possibly allowing privately owned lenders.