hey are
probably right to worry. The state domination of the economy will be eliminated. The
restrictions and barriers on retailing and distribution will be eased. For example, at
present, foreign retailers can only open 50%-owned joint ventures with central-
government approval, and are limited to distributing goods made in China, and they also
must use a Chinese company for distribution. But after China will have joined WTO,
foreign retailers such as Wal-Mart will be able to set up 100%-owned operations and its
own distributing methods. Other examples include foreign telecommunication
companies, automakers, and finance institutions etc. The opportunities that WTO-
mandated freedom will open up for foreign companies are extraordinary. The bottom
line is that foreigners will have the equal right to compete in China according to clearly
Why does China still dream for the WTO membership despite of these difficult
challenges for many Chinese officials and enterprises? The answer is China's leaders'
desire for a complete domestic reform. The decision by President Jiang Zemin and
Premier Zhu Rongji to join the WTO reflects a belief that domestic reform needs the
external pressure of WTO entry. In the minds of many tope Chinese leaders, the most
important reason for China to join the organization is to ensure that domestic reforms
continue. It is very much in China's domestic interest to see the successful
implementation of WTO standards. Although that may seem unconvincing, after all the
WTO's main role is to ensure that trade develops accordingly to international rules,
China actually hopes that the introduction of a rule-based system will anchor its own
After securing its entry to the WTO recently, China must realize the challenges lying
ahead and the reforms it must make in order to compile with the WTO standards and
expectations. The areas that call for r...