Ian Lancaster, chief representative of the Chubb Group of insurance companies, was too excited to sleep last Thursday morning. He stayed up until 3am to see the result of the United States Congress vote awarding permanent normal trading relations (PNTR) status to the mainland. The bill passed by 237-197 votes, a milestone for US business in the mainland. 'Everyone was jubilant,' said Mr Lancaster, also a vice-president of the American Chamber of Commerce in China. 'I had a few drinks. But, after a good night out, you need several cups of coffee to sober up. 'It will take a lot longer than most people expect, to see the benefits. The devil is in the detail. It will take six-18 months for China to modify all its laws and regulations to meet the requirements [of the World Trade Organisation]. 'Many companies have been holding back until this modification is complete. China is a medium and long-term play.' The Congress vote will provide US companies with the same most-favoured-nation treatment Beijing gives other foreign firms when it enters the WTO, which is expected before the end of the year. This sober reality was reflected in the coverage of the vote in the official media on Friday. The People's Daily relegated it to the back page, in two brief reports of the statements of the Foreign and Foreign Trade ministries, which welcomed the vote but attacked Congress for setting up of a commission to monitor the mainland human rights record. There was no thanks to President Bill Clinton, his government and the business community for their efforts to pass the bill in the face of opposition from organised labour and religious and human rights groups. Nor was there a mention of the significance of the bill as a milestone in Sino-US relations, in removing the formal link between trade and human rights for the first time in 20 years and as a vote of confidence in the mainland's future. Beijing's low-key response is probably due to two factors. One is anger that the human rights element was not removed all together. The other is the anxiety felt by millions of mainlanders at the consequences of WTO entry and enormous work Beijing needs to do to change its legal and regulatory system to meet WTO requirements. 'Once China enters the WTO, the biggest pressure will be on agriculture and state-owned companies,' said Chen Fengying, an economist at the China Research Centre for Modern International Relations. 'By 2004, Beijing will drop its tariffs on US priority agricultural products from an average of 31 per cent to 14 per cent. This will pose an unprecedented challenge to China's farm goods. 'The biggest danger is for the country's financial industry - how can it meet the challenge of liberalisation and globalisation?' Cars, petrochemicals and distribution are other sectors with over-capacity and low efficiency and which will be badly hit. The government faces a colossal task, to manage the closure of companies and find work for the millions of people who will lose their jobs. Many of them, industrial workers over 40, will be unable to adapt to new computer-intensive, service jobs and may become long-term unemployed. Concern over this restructuring is one thing worrying foreign companies who wonder how keen bureaucrats will be to implement the WTO rules when they will result in closure of their local companies and social instability. They also wonder how long other hazards of investment - such as lack of transparency, internal rules, bureaucratic red tape and corruption - will persist even after the mainland is a WTO member. Mr Lancaster outlined other concerns of foreign firms. 'Chinese companies are responding very fast and providing tougher competition than most foreigners expect. Look at how the airlines have reorganised themselves, the products and after-sales service of Haier [maker of white goods] and the improving quality of Chinese wine. 'There is a shortage of expatriate managers experienced in Asia and China in particular to head up operations. One study found that only 25-30 per cent of foreign managers were successful in adapting culturally, setting up business and control mechanisms and suiting international business practices to China.' He also said multinationals had become more cautious about investing here and were looking at alternatives in Latin America, Eastern Europe and other parts of Asia. 'Before, people said that you could not afford not to be here. Now analysts look at your results and ask when the payback will be,' he said.