Investors To China: Open Those Books

China's top proto-capitalists are going back to school. Starting Oct. 16, 160 senior execs from the country's biggest state-owned companies will spend three weeks at the spanking new campus of the National School of Administration in western Beijing, studying international capital markets, privatization, and the impact of foreign competition on China's closed markets. The course, given on government orders, is all part of Beijing's ambitious effort to whip management into shape at state-owned enterprises.

Those managers aren't just worried about term papers. As the year winds to a close, many face two enormous sources of pressure. One is China's imminent entry into the World Trade Organization. WTO entry will eliminate trade barriers and expose state companies to competition for the first time. The other source of pressure will be shareholders. And they will be of the most demanding variety--multinationals and big Western funds looking for the next great China play. These investors will want results, and the state companies' executives are being told they must deliver.