Implications

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An efficient and secure electronic payment system and a stable and transparent operating environment will help China to play an important domestic and global role, as a formal member of the World Trade Organization (WTO). As a member, China is obligated to gradually open its sectors to overseas investors and implement market-based mechanisms for free and fair competition. The opening of markets for foreign participation entails the need to create stability and predictability in the operating environment so that investors can plan their activity in the Chinese market with greater certainty. Secure electronic systems and robust operating legal structures will help to maintain market confidence for the sound functioning of both financial and economic systems within the emerging market economy. On the global front, e-commerce is becoming a key facet in globalisation, and robust electronic payment mechanisms will help China to integrate with this increasingly electronic-based and competitive global trading system. It is imperative that the local banks cooperate to resolve the incompatible standards and non-interoperable payment systems, because non-traditional competitors (foreign companies) with sophisticated networks and innovative product offerings are increasingly entering the domestic markets in this WTO environment. Otherwise, the electronic payment system and the economic system will not be able to cope with the pressure generated by changes in market structure and business practices in a fully open domestic market or a competitive global market.

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