China is not yet ready to open up its publishing sector to overseas investment, a senior publishing official said at a press conference for the General Administration of Press and Publication in Beijing yesterday.

China made no commitments to the World Trade Organization when it joined the body in late 2001 pertaining to overseas investment in the publishing industry, noted Yu Yongzhan, deputy director of the GAPP.

China's state-run publishing companies are not ready to compete against their foreign counterparts, Yu said.

According to its pledge to the WTO, China has been gradually opening up the retail market for publications, he said.

By the end of the year, the publication wholesale market will be fully open to overseas investment.

And overseas investors would be able to establish printing ventures and independent packaging printing firms in China. Foreign investors are allowed to cooperate on copyrights with Chinese publishers.

Currently, foreign investors are not permitted to invest in the publication of books, newspapers, periodicals, audio/visual products and electronic publications.

Yu also noted that the Chinese government still bans foreign publishing organizations setting up branches in China.

By the year-end, overseas businessmen will be allowed to form both wholesale and retail enterprises pertaining to the book, newspaper and periodical market, including Sino-overseas joint ventures, Sino-overseas cooperatives or solely overseas-funded ventures, Yu said.

The government always encourages and supports the exchange and cooperation between Chinese publishing firms and their overseas counterparts, he said.

After its entry into the WTO, China has adjusted some policies and further expanded the investment sphere of industries concerning publication for overseas businessmen, said the official.

On printing, overseas investors can now establish printing enterprises in the form of Sino-overseas joint ventures or Sino-overseas cooperation, or establish wholly overseas-funded package and decoration printing enterprises, said Yu.

In the field of publication, Chinese and foreign publishers can have copyright trade or carry out cooperative publication.

According to Yu, remarkable progress has been made toward the opening of China's publishing industry, and most foreign investment is currently concentrated in the printing sector.

Meanwhile, China's first nationwide publication distribution company premiered in Beijing yesterday.

The company, Little Red Cap, is based on the newspaper distribution network dominated by the Beijing Youth Daily. It has been authorized to run the nationwide wholesale and retail of newspapers, magazines, books and electronic publication. It has secured the right to open chain branches across the country.

The new publication distribution network union has 29 member newspapers and distribution companies with a daily circulation of 15 million and nearly 100,000 employees.

The annual advertisement revenue of the union is nearly 10 billion yuan (US$1.2 billion), half of the total earned by all newspapers.