Mattoo, Aaditya2014-08-012014-08-012002-12https://hdl.handle.net/10986/19194China's General Agreement on Trade in Services (GATS) commitments represent the most radical services reform program negotiated in the World Trade Organization. China has promised to eliminate over the next few years most restrictions on foreign entry and ownership, as well as most forms of discrimination against foreign firms. These changes are in themselves desirable. However, realizing the gains from, and perhaps even the sustainability of, liberalization will require the implementation of complementary regulatory reform and the appropriate sequencing of reforms. Three issues, in particular, merit attention: 1) Initial restrictions on the geographical scope of services liberalization could encourage the further agglomeration of economic activity in certain regions-to an extent that is unlikely to be reversed completely by subsequent countrywide liberalization. 2) Restrictions on foreign ownership (temporary in most sectors but more durable in telecommunications and life insurance) may dampen the incentives of foreign investors to improve firm performance. 2) Improved prudential regulation and measures to deal with the large burden of non-performing loans on state banks are necessary to deliver the benefits of liberalization in financial services. And in basic telecommunications and other network-based services, meaningful liberalization will be difficult to achieve without strengthened pro-competitive regulation.en-USCC BY 3.0 IGOTRADE AGREEMENTSSERVICESSERVICE EXPORTSREFORM POLICYWORLD TRADE ORGANIZATIONRESTRICTIONSFOREIGN ENTERPRISESOWNERSHIPTRADE LIBERALIZATIONREGULATORY REFORMTELECOMMUNICATIONSLIFE INSURANCEFOREIGN INVESTMENTSPERFORMANCE INDICATORSPRUDENTIAL REGULATIONSFINANCIAL SERVICESCOMPETITIVENESS ACCOUNTINGAIRPORTSAUXILIARY SERVICESBANKING SECTORCAPITAL REQUIREMENTSCITIESCOLLABORATIONCOMMERCIAL PRESENCECOMPETITIVE DISADVANTAGECOMPETITIVE MARKET STRUCTURESCONSUMPTION ABROADCROSS- BORDER SUPPLYCROSS-BORDER DELIVERYCROSS-BORDER SUPPLYCURRENT COSTSDEBTDEPOSITSDIRECT INVESTMENTDISTRIBUTION NETWORKSDISTRIBUTION SERVICESDOMESTIC FIRMSDOMESTIC REGULATIONDOMESTIC REGULATIONSECONOMIES OF SCALEENERGY SERVICESENGINEERING SERVICESENTRY RESTRICTIONSFINANCIAL SERVICESFIXED COSTSFOREIGN BANKFOREIGN BANKSFOREIGN CAPITALFOREIGN ENTRYFOREIGN INVESTMENTFOREIGN OWNERSHIPFOREIGN PROVIDERSFOREIGN SERVICE SUPPLIERSFULL LIBERALIZATIONGATSGOVERNMENT DEBTHEALTH SERVICESIMPORTING COUNTRYINCOMEINCUMBENT SUPPLIERSINFANT INDUSTRY POLICIESINFANT INDUSTRY TYPEINSURANCEINSURANCE COMPANIESINSURANCE COMPANYINSURANCE SERVICESINSURERSINVENTORYLIBERALIZING COMMITMENTSLIBERALIZING INTENTLICENSESLIFE INSURANCELIMITED ACCESSMARGINAL COSTMARKET ACCESSMARKET ACCESS COMMITMENTSMARKET FAILUREMARKET STRUCTUREMEDICAL SERVICESMFNMFN EXEMPTIONSMODES OF SUPPLYMOST-FAVOURED-NATIONNATIONAL TREATMENTNATURAL MONOPOLYNATURAL PERSONSNEW ENTRANTSNONPERFORMING LOANSPOLICY RESEARCHPREFERENTIAL ACCESSPREFERENTIAL LIBERALIZATIONPRESENCE OF NATURAL PERSONSPRO-COMPETITIVE REGULATIONPROFESSIONAL SERVICESPROVISIONSQUANTITATIVE RESTRICTIONSQUOTA RENTSRADIORECOGNITION AGREEMENTSREGULATORY AGENCYREGULATORY FAILUREREGULATORY FRAMEWORKREGULATORY MECHANISMSREGULATORY PRINCIPLESREGULATORY REFORMREGULATORY REQUIREMENTSRENT APPROPRIATIONREVENUE SHARINGROADSSATELLITESSCALE ECONOMIESSERVICE SECTORSSERVICE SUPPLIERSERVICE SUPPLIERSSERVICE TRANSACTIONSSERVICES LIBERALIZATIONSERVICES MARKETSSERVICES NEGOTIATIONSSERVICES SECTORSSERVICES TRADESEWAGESPILLOVERSSTATE BANKSSUBSIDIARIESSUBSIDIARYTAXATIONTELECOM INFRASTRUCTURETELECOMMUNICATIONSTELECOMMUNICATIONS SECTORTELECOMMUNICATIONS SERVICESTRADE DIVERSIONTRADE IN SERVICESTRADE SERVICESTRADING PARTNERSTRANSPARENCYTRANSPORTTRANSPORT SERVICESURBAN PLANNINGWTOCOMPETITIVENESShttps://doi.org/10.1596/1813-9450-2932