ABSTRACT
China’s growth and trade expansion since its entry into the WTO has been spectacular and driven to a large extent by steady and sustained incremental reforms since the late 1970s. China’s WTO accession led to deep structural changes that are at the core of its transformation towards a modern market-based economy. Yet, these achievements and policy reforms may soon run their course. Recent OECD research indicates that to sustain high growth and its position in the global economy, China needs to continue with – and in some areas accelerate – structural reforms. This includes removing remaining pockets of border and behind-theborder protection, progressive reforms of the state-owned enterprise sector and agriculture, as well as rethinking its strategy with respect to raw materials markets. Reforms of services sectors, in particular, will be key to escaping the pitfalls of middle-income transition. If China were to achieve in services trade what it has accomplished in manufacturing then it needs to reform its services sector in the same spirit as it has done with its manufacturing sector. Liberalised business services will facilitate and accelerate the process of moving up the value chain; reform of telecommunications will foster the information economy; and access to better and more efficient financial services will support the development process in general.
