THE VENUE FOR the Beijing Book Fair was shabby, and the international dealmakers stayed away, but the turnout was respectable - and showed how far mainland publishing has come in 10 years. Compared with the dull displays of a decade ago, the covers were eye-catching, at least. Titles included the inside story on the perils of being an investigative journalist in China, an alcoholic's autobiography, and a translation of the work of celebrity chef Anthony Bourdain. The nation's best-seller, We Three, by 92-year-old Yang Jiang, was presented in an old-fashioned, brown-paper cover - a rare touch of nostalgia in a country rushing into the future. Yang's account of the life of her intellectual family is in its 15th print run since its launch in July, and has already sold more than 400,000 copies. Hit the jackpot with a book in China and the rewards can be great. Not surprisingly, foreign publishers are keen to breach the mainland market. Overseas firms face hurdles, but there are signs that China's publishing industry, still under government control, is headed for big changes. 'The government is proactive,' says Christian Unger, the Shanghai-based president of publishing giant DirectGroup Bertelsmann China. 'It is very fascinating and very positive.' All Chinese publishers are state-owned. In 2002, the country's 560 publishers printed 69 million books, or 171,000 titles - an increase of 16,000 over 2001. Of these, 101,000 were new publications, and the biggest printing centre was Shanghai, which produced more than 14,000 titles. The magazine market is also growing. In 2002, more than 9,000 were published nationwide - a modest increase from 8,890 the previous year. During the 15 years it took to negotiate China's entry into the World Trade Organisation (WTO), neither the US nor the European Union pushed the government to open its publishing industry. It was considered crucial to the Communist Party's political control and too sensitive. 'China did not make any commitments to liberalise the printing and publishing sectors,' says WTO spokesman Joseph Bosch. 'They are not under any obligation to open up their market in these areas if they don't want to.' Yet, just over two years since China joined the world trade body, in September 2001, there are signs it may liberalise voluntarily. WTO commitments to open the country's book and magazine-distribution system - part of its overall retail commitments - are being met as much as a year ahead of schedule. Industry insiders are confident. 'We thought they would come up with a content schedule, maybe after 2008,' says Unger. 'But now, because they are so proactive, we think they may come up with a content schedule by 2006 - before the Olympics.' Chinese publishers have the most to lose should slicker, richer foreign publishing houses enter the market. 'We have a few ideas but we haven't seriously thought about it,' says Wang Jiaming, deputy general manager of SDX Joint Publishing Company, one of the mainland's oldest publishers, set up before 1949. 'I don't think they're going to start opening it up until 2010, at the earliest. And I don't think the leadership knows when it will happen, either. It will depend on the country's economic and cultural situation.' Economics, rather than a desire to remove state control of the publishing industry, lies behind the coming change. According to its WTO commitments, China was obliged to let foreign companies into the book-distribution system by the end of this year - first, by letting them buy minority shares in Chinese distributors and, later, majority stakes. That timetable was brought forward in December, when Bertelsmann bought a 40 per cent stake in 21st Century Book Chain, one of three licensed nationwide book distributors and the first private distributor. The deal was 'a big breakthrough', says Unger. He says the licence was only a first step. 'Our experiences shows that, even after you get the licence, it can be painful and takes a lot of time,' he says. 'Nobody should underestimate the operational complications and difficulties they might have by receiving this licence. Here, it takes six to 12 months to make use of a licence. China is not like other countries where you can get on with it immediately.' Content is the next challenge. 'That's an area we are intending to move into,' says Unger. 'I would say it is the most restricted area in China.' So far, it's not clear how foreign companies will be able to get into the mainland publishing market, he says. 'We can't develop that roadmap because, first, we need that mega picture from the Chinese government.' Some idea about how it might happen came last month, when the State Administration of Radio, Film and Television (Sarft) said it would lift a ban on foreign investment in broadcasting and film-production companies. Jeanette Chan, a Beijing-based WTO and media expert at law firm Paul, Weiss, says the announcement was significant, but that implementation details were missing. 'This is a huge opening up and improvement of the policy before, and I believe they will allow foreign investment in publishing, too.' But she says 'the announcement is just a policy; they have not issued the regulations'. Nor was the announcement a sign that the government plans to weaken its control. Sarft said foreign companies were barred from news programmes. A similarly selective approach to publishing is likely. Meanwhile, an alternative to direct investment already exists in the form of co-publishing, particularly in the magazine market. Most major western titles - such as Elle, Cosmopolitan or Forbes - are already published like this. Although co-publishing offers foreign companies control in some areas, such as advertising and technical assistance, it keeps editorial control firmly in Chinese hands. And for many foreign companies, that's not acceptable. Unger says Bertelsmann plans to focus on the education market, then move into literature, citing titles such as Dan Brown's The Da Vinci Code or biographies of prominent foreigners. Wang says ideologically neutral subjects such as science may be the most likely starting points for foreigners. 'In science, we might be able to co-operate,' he says. 'Of course, if the sales part is loosened up, that can affect content. You have to look for books that sell well, and you change content accordingly. Publishing has to follow popular demand, too.'