Official membership starts the clock running on a number of market-opening reforms and tariff reductions promised by China to the U.S. and the European Union. Most Chinese industries can expect to be performing without the net of government protection by 2005, which lends urgency to the cause of state-owned enterprise reform. That explains the SOEs' pressing need for capital. The global markets can fill that need in ways far beyond the capacity of China's illiquid banks and immature equity markets. But such benefits are not certain.
Early signs are encouraging.
The cream of China's corporate crop will be streaming into the international markets in the coming few years. The brokerage firm was the principal underwriter of China Unicom's IPO and will take the lead on several other major overseas listings expected this year. The listings represent a new direction in China's economic transformation. In the 1980s, investments from overseas Chinese were key to getting the reforms started at a time when the mainland was so backward and undeveloped that many foreigners wouldn't chance an investment. That changed in the 1990s.