Joining The Wto And China's Banking Reform And Development

Executive SummaryChina's accession to WTO has now been considered as an inevitable trend, which will come true in the near future. According to the WTO agreements, after China's accession to WTO, the wholesale banking and retail banking will be open to foreign competitors during the first two years and in five years respectively. According to the General Agreement on the Trade and Agreement on the financial Services, after China's access to WTO, it is envisioned that there will be more foreign financial institutes in China, especially those largest international banks, which will compete fiercely with domestic counterparts. Comparing with domestic banks, foreign banks have advantages in areas such as business conglomeration, integration, ample financial products, management expertise as well as competitive salaries. In contrast, domestic banks have lower capital adequacy and poor assets and accounting information quality. While their intermediately business is very weak with overstaffed organization and worse external environment, there is big discrepancy in the service retinal with foreign banks. In this contest, WTO entry will provide our economic development with a wider arena, a valuable opportunity. At the same time, WTO entry will put domestic banks in the presence of severe challenges and impacts. Financial sector as the core of the economy, strongly related to the national economic satiety. Banking sector is the main body of our financial sector with approximately accounts for 90% ofthe total financial assets.How can Chinese banking sector "Dancing with the Wolf " is a general topic for both the staff members and researchers in financial sector.The essay starts with the current conditions of banking sector in China, and points out that there exists monopoly and insufficient operation environment in the banking sector. After comparing both advantages and disadvantages of domestic and foreign banks in China markets, the essay analyses the impacts of WTO accession on the domestic banking sector and the supervision system. Furthermore, the essay puts forward some " suggestions on how to improve the competitiveness of China's State-Owned-Banks, joint stock commercial banks, city commercial banks, and credit cooperatives. In the end, the essay forecasts some development trends for the banking industry after China's accession to WTO.Meanwhile, the assay deeply and systematically explored the ways in putting forward the financial system reform, consummating financial regulatory system and legal structure, synthesizing the supervisory function, and expediting the transformation form business segregation to the conglomeration, and market of interstates to improve external environments for commercial bank for their international competitiveness in meeting with WTO accession challenges.