Beijing: World Bank (WB) president James Wolfensohn on May 30 urged the Chinese government to allow a free Press as an essential part of pushing the country's economic reforms onto their next stage.

Wolfensohn, at the end of an eight-day visit to China, also said a more open civil society, shorthand for enabling people to organise themselves outside of government control, would be beneficial.

"You need a free Press and civil society which can be a watchdog," he told reporters in Beijing.

"The role of the Press is tremendously important and the ability of the public to express its views is very important," he added.

Specifically, a more vocal Press and a less timid public would help ward off any large-scale emergence of the cronyism and corruption that brought Asian economies to their knees in the late 1990s, he argued.

A freer media and elements of a market economy such as greater transparency will develop automatically to some extent, but politicians can help the process along, Wolfensohn said.

"I think that comes with the maturity of the market," he said. "But for certain it requires leadership at the top."

China has been the world's fastest growing major economy since it kicked off economic reforms more than two decades ago.

The country of 1.3 billion is now moving into a new phase of change, where more of the trappings of a capitalist economy will be introduced, such as smoothly functioning financial markets.

"To have effective development of a market economy, it's necessary to have a strong legal and judicial system, good regulations, a strong financial system, and you need to fight corruption," Wolfensohn said.

He also said that it was also necessary for individual companies to change their corporate cultures and become more transparent and more law-abiding.

"In many countries, the easiest part is to change the laws," he said. "The most difficult part is to change the culture."

Again, political guidance is needed, Wolfensohn said, apparently referring to the next generation of Chinese leaders set to take over power in the course of the coming year.

"I think it's really for the next group of leaders to make sure it happens," he said. Wolfensohn said China had already made large strides towards greater openness on sensitive issues.

Investment inflows will have to be a mixture of foreign and local money, he added.

"Until foreign investors see that the Chinese from the East believe in the West, you are less likely to see large investments," he said.

The bank intends to lend between $ 1.3 billion and $ 1.5 billion annually to China in the coming years, he said.