After its agreement with the United States in November 1999, China's difficult negotiations with the European Union are now in the last stages of the long process towards its membership of the WTO. There are substantial issues at stake. Concessions negotiated bilaterally will be extended to all member countries, but each partner is striving to open up the Chinese market most in those areas in which it has a strong capacity to export and invest. For China, WTO membership will mark the end of the selective "open door" policy it has pursued for 20 years. The liberalisation will lead to an important reallocation of resources across sectors, which will entail high economic and social costs, but which China expects will benefit growth in the medium term. Indeed, WTO membership appears as a means of re-launching reforms that are necessary for the modernisation of the Chinese economy.
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