CONTRARY TO WHAT one might expect, the Asia-Pacific Economic Co-operation forum is becoming less important for China's economy. The significance of the Apec meeting in Shanghai this week was overshadowed by China's imminent membership of the World Trade Organisation. 'Apec is not so important now that China is joining WTO,' said Professor Lu Yan, an expert in international trade at the Chinese Academy of International Trade and Economic Co-operation. 'After all it is only an economic forum. But WTO is different. It plays a real and much more practical role.' China's 15-year quest to join the WTO probably will end immediately after the Shanghai meeting if a majority of WTO members gathering in Doha, Qatar, votes China in. China will then have to complete its own legislative procedures, but that is not expected take much more than a month. Apec is of great importance in the early 1990s because it was the first international trade body that China joined that was committed to free trade. Its participation in the ambitious programme agreed by the 21 Apec members, including a commitment to abolish all tariffs between members states after 2010, is taken as clear evidence of China's readiness to play according to WTO rules. Ironically, it is now the commitment of the former Asian economic tigers which is in doubt. Over the past four years, the economies of Thailand, Indonesia, Malaysia and others in the Association of Southeast Asian Nations grouping have taken a battering and protectionist forces could now slow measures to open up their economies. 'This is testing their real commitment to reform and liberalisation. Are they going to keep pushing ahead with Apec goals and making structural changes?' questioned one senior Western diplomat in Beijing. By comparison, China has continued to be a big beneficiary of the world trade system. Its growth has held up and foreign investment has not faltered, so Chinese leaders have found it easier to make a strong case for China's membership. Even so, the government has yet to publish the details of what China's membership actually entails. China's future export performance now looks to be assured, which will encourage investors inside and outside China. But what is more interesting is how Beijing is using WTO entry to push through domestic political reforms. In a recent article in Nanfang Zhoumou newspaper, Wu Jiahuang, vice-president of the China WTO Research Institute, explained that 'capacity building' would now be at the top of the agenda. 'The government knows very well that with China's entry into WTO the bureaucracy will have to change its functions and responsibilities . . . We have to get rid of regulations limiting the import of industrial products and this requires us to change many government functions,' he said. Government officials would no longer be issuing import permits or directing investment in state-owned enterprises. 'The working style of the government will also change. We need a smaller government with fewer staff and higher productivity. We don't need a big bureaucracy anymore,' he said. Mr Wu envisaged the government becoming 'a service provider' after China joined the WTO. 'All government officials must recognise this fact and change their work style. In accordance with WTO regulations, the management style must become open and transparent. Trade regulations must not be enforced before they have been made public,' he said. This fits very well into the philosophy of the Apec forum, which is increasingly pushing to reduce non-tariff barriers to trade and to devise schemes to cut bureaucracy. Apec is trying out a system of special visas for its businessmen, modelled on the system pioneered by Australia for the Olympics, and paperless trade transactions. The key difference for China switching its attention from Apec to WTO is that the WTO has the power to arbitrate in disputes between different members. Apec works on consensus and tries to avoid confrontation. The WTO is at the forefront of the conflicts of interests between the developing world and the richer economies. China was under pressure to join the WTO before the WTO began a new round of trade liberalisation following the Uruguay round. Two years ago, the last big WTO meeting in Seattle ended without any agreement against a background of riots by anti-globalisation protesters. The same groups will be noticeably absent in Shanghai, where the top leaders are duty-bound to affirm their faith in further trade liberalisation. The Doha meeting will be the test of how much preparation has been done by the WTO secretariat since Seattle. Although China had been pressing to join the WTO before the new round started, this is no longer an aspect that preoccupies Beijing, although it will be an observer at the meeting. 'The Chinese Government will insist on implementing the resolutions made at the Uruguay talks first before considering other measures,' said Xu Jinliang of the Foreign Trade and Economics University in Beijing. According to the timetable worked out with the United States, China will have five years to adapt to the WTO requirements. In fact, it is clear from talking to experts that the government has not given much thought to its position on the contentious issues dividing the WTO members. As a major economy that straddles the definitions of a developing and developed economy, its weight will eventually tell. 'Once China is an official member, the government will focus on unfair competition in the service industries and fight to bring social issues like the environment and labour standards into the WTO,' said Mr Xu. China will therefore be very much in the developing country's camp when it comes to trying to agree on common standards in the area of labour and environment, but it probably has different interests when it comes to agriculture. 'China has to protect the interests of the peasants once it joins the WTO. 'The government will try to limit the import of agricultural products as much as possible,' Mr Lu said. Many developing countries would benefit if the trade in agricultural goods were freed and if rich countries in Europe and North America cut their enormous agricultural subsidies. China is still a long way from reducing the influence of the government on the agricultural sector and is expected to drag its feet even on implementing the cautious measures agreed under the WTO package of reforms.