The Chinese premier, Mr Zhu Rongji, has warned that China's membership of the World Trade Organisation, which formally begins today, will come with a heavy price.
While WTO entry was necessary for China's continued economic development, some industries and enterprises will suffer in the short term, the premier said yesterday.
"Whether the benefits outweigh the disadvantages will depend on our work." he said.
China is signing up to WTO entry after 15-year-long negotiations for admission to the global trade body. Entry will integrate the country further within the world economy, and will help cement reforms started when China first opened up in 1978. It will also allow China to expand trade, attract more foreign investment and give private firms a greater role in the economy.
Foreign investors hope the opening up of this huge market will bring new customers through freer access to the country's 1.3 billion people. However, Premier Zhu warned that the international economic environment was going to face problems in the next year, and that it was more important than ever that China did well.
Growth in the Chinese economy is expected to slow to its lowest level in more than a decade, below the crucial 7 per cent needed to create jobs for tens of millions who will lose their jobs through the streamlining of state enterprises.
Premier Zhu has told local officials they must become familiar with WTO rules as soon as possible and toe the line on implementation. "China is a country which keeps its word. We must earnestly implement our pledges," he said.
In recent days, authorities have announced a raft of new rules aimed at bringing China into line with WTO commitments. The central bank announced yesterday that from today foreign banks could apply to conduct domestic currency business in two more cities, Tianjin and Dalian, in addition to Shanghai and Shenzhen.
Meanwhile the South African President, Mr Thabo Mbeki, began his first trip to China yesterday. In a meeting with the Chinese President, Mr Jiang Zemin, President Mbeki said strengthening economic relations was the key aim of his visit.
Relations have blossomed since South Africa restored full diplomatic ties with China in 1998 after recognising Beijing's claim to govern Taiwan. Last year, China was South Africa's 10th most important export market.